renegotiate

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renegotiate

An agreement to revise the terms of a contract.Promissory notes,mortgages,leases, and other contracts can typically be renegotiated if failure to do so will result in default and that default would be economically disadvantageous to the other party. This power to renegotiate is exemplified by the old saying referring to loans from small banks,“If you owe the bank $10,000, they own you. If you owe the bank $1,000,000, you own them.” A debtor in bankruptcy can force renegotiation of onerous contract terms,such as a long-term lease at above-market rental rates.