A great source of questions from readers centers around the use of unfamiliar terms. Let’s revisit some of the more useful and some of the off-the-beaten-path definition requests.

Q: We are planning a big remodeling project. The agreement that the contractor wants us to sign includes a section with a heading that says “Force Majeure,” but all the legal gobbledygook that follows it is hard to understand. Can you help?

A: Sure. Most construction contracts include a provision for “Force Majeure,” the Latin term for “greater force.” The provision allows the builder or contractor to avoid financial liability if an unforeseen problem prevents the project from being completed on time.

A force majeure doesn’t just cover hurricanes, earthquakes, fires or other “Acts of God.” It also typically covers unexpected delays caused by war, or the failure of a supplier or subcontractor to perform contractual obligations of their own.

For example, if your remodeler promises to finish the job by Dec. 15 but some custom cabinets or other special items you ordered don’t arrive until a week later, the force majeure will protect the remodeler from being held responsible for missing the promised completion date.

Q.: What is the difference between a property’s “actual age” and its “effective age”?

A.: A property’s actual age is determined strictly by the year it was built, while its effective age is mostly determined by the care it has received from its owners.

Let’s say a property you want to buy was built in 1995, but the seller never performed routine maintenance and also rented two of its three bedrooms to a local rock band that punched holes in the wall after every concert. The actual age of the home would be 12 years, but its effective age might be 20 or even 30 years because the property is in such bad shape.

Q.: Is there a difference between a “judgment” and a “judgment lien”?

A.: Yes. A judgment is basically a court decree stating that one person owes another person a specific amount of money. A judgment lien is a subsequent claim against the debtor’s property that the winner of the court’s ruling sometimes must file to collect a court-ordered debt.

Let’s say that you won a lawsuit filed against Joe Defendant and the court awarded a $2,000 judgment in your favor. If Joe refused to pay, you could use the court’s judgment decree to file a judgment lien against his home or other property. The lien would prevent Joe from selling the property without first settling his debt to you.

Q.: Can you please explain how an “exculpatory clause” works in a mortgage contract?

A.: Sure. An exculpatory clause is a provision in a mortgage that allows the borrower to surrender the indebted property to the lender without being liable for the loan.

Say you bought a $150,000 home with a $20,000 down payment and a $130,000 mortgage that included an exculpatory provision. If you later abandoned the property or couldn’t keep up with the payments, the lender could take the house back and sell it on the open market, but the exculpatory clause would prevent the bank from pursuing your other assets – like your car or savings accounts- to make up for any difference between the resale price and the amount you owe.

Q.: What is a real estate “betterment”?

A.: It’s an improvement that actually raises a property’s value, as opposed to repairs or replacements that simply help to retain its value.

To illustrate, the addition of a new bedroom or bathroom would be considered a betterment because the new room would increase the home’s value. Replacing a leaky washer or pipe would not be a betterment because the job would merely help to keep the property’s current value intact.