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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 contract can be a verbal agreement, which is legally binding but difficult to prove in case of disputes. Therefore, it is crucial to get everything in writing to avoid misunderstandings. The speaker shares a personal experience from their first six months in business where a lack of a written contract resulted in a loss of about three thousand dollars. This lesson highlights the importance of formalizing agreements to protect against financial loss.
