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Understanding different types of construction contracts is crucial for determining costs, liabilities, and project expectations. Contracts protect both the builder and owner by clarifying expectations and avoiding issues like overages. Various types of contracts are tailored to project needs, including lump sum contracts with fixed prices, cost-plus contracts with builder reimbursements for costs plus a fee, time and materials contracts based on actual costs, and unit pricing contracts for specific tasks. Each contract type serves different project needs, so it is essential to choose the most appropriate one based on the project requirements.
