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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. It's crucial to get everything in writing to avoid misunderstandings. The speaker shares a personal experience in their first six months of business, where not having a written contract resulted in a loss of $3,000, highlighting the importance of clear documentation to prevent financial setbacks. Getting contracts in writing is a fundamental rule for protecting oneself in business dealings.
