What is executory interest examples?

An executory interest is a type of property interest that exists when a property owner transfers ownership of their property subject to a condition or event that must occur before the new owner can possess complete ownership. It is essentially a future interest in someone else's property.

Examples of executory interests include:

1. A leasehold interest – when a tenant signs a lease agreement with a landlord, the tenant is granted an executory interest in the property for the duration of the lease.

2. A mortgage – when a borrower takes out a mortgage on a property, the lender is granted an executory interest in the property until the borrower satisfies the terms of the loan and fully repays it.

3. A life estate – when a property owner grants someone a life estate interest in their property, the named person has an executory interest that will become possessory upon the original owner’s death.

4. A conditional gift – when someone gifts property to another person, but with conditions attached to it, such as requiring the recipient to graduate from college in order to fully receive it, an executory interest is created until the condition is met.

Executory interests can be useful in estate planning, property transactions, and other legal matters where conditions or contingencies need to be addressed.