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Construction contracts are agreements between two parties, typically involving the exchange of money for services, like building a house. While verbal agreements are legally binding, they are difficult to prove in case of disputes. It's crucial to get everything in writing to avoid complications. The speaker shares a lesson learned in their first six months of business, where a lack of written contracts led to a financial loss of about $3,000. This experience emphasizes the importance of formalizing agreements to protect oneself in business transactions.
