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Construction contracts are agreements between two parties, typically involving an exchange of money for services, like building a house. The simplest form of a contract can be a verbal agreement, which is legally binding but difficult to prove in case of disputes. Therefore, it is essential to get everything in writing. The speaker emphasizes the importance of written contracts, reflecting on a personal experience in their first six months of business, where a lack of a written contract resulted in a loss of approximately three thousand dollars, highlighting the potential financial risks of informal agreements.
