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understanding the different types of construction contracts is essential as they determine what you pay what you are liable for and many other aspects of the job a contract protects both the builder and the owner by ensuring expectations are clear from the beginning and avoiding potential headaches caused by overages and other unexpected issues there are many types of building contracts and they are usually tailored to the needs of the project to help you get familiar with your options we explain the differences between different types of contract and when you should consider using each one for your project we use builder to refer to the entity carrying out the construction services an owner to refer to the entity contracting the builder to carry out construction services [Music] so now lets dive into the four different types of construction contracts number one lump sum contracts lump sum contracts use a fixed price for all work done on the project these construction contracts are a
