Using Common Sense
October 2006, Apex Truss is running about 5 million a year from 0 in 2000. We have two production plants and a dream partner. Life is good. I go buy a 240k house, and in five years it’s worth about 450k. All I’ve done is mow the lawn and put in this fishbowl of a pool. But I start looking around, turning my eyes to what’s going on out there. Soon I was saying to myself that this isn’t sustainable, how could some kid, maybe a schoolteacher afford any of this on their salary? How could they get a starting home on $35,000 a year? I read that people were buying houses and holding them for about six months and then flipping them for at least $50,000. That’s just crazy to me.
So I’m at this volleyball game, talking to a friend of mine. He used to work at a nuclear power plant. He starts telling me about all these deals he’s been making as a real estate agent. He started doing 80-10-10’s –you get money at closing, so you buy an 80% mortgage and then a 10% mortgage and another 10% mortgage--THEN you get cash based on the value of the property when purchased. So I say to myself, this is the dumbest thing I’ve ever heard. That night I go home to my wife and I say, “We need to pay everything off.” I’ve been reading, paying attention, I know it’s coming. It’s coming and it isn’t going to be pretty. It will collapse. There will be a bloodletting.
In that October 2006, we start paying everything off. I owed money on my plant in Troy, which is in Charlottesville, Virginia. So I doubled payments, which we finished by April of 2007. I set up a loan to start paying my partner back after buying him out and close the plant in Troy by May of 2007. (In February of 2006, housing starts at 2.1 million annually) Regardless of intention, this gets the rumor mill started. People get the idea we’re going out of business; we’re shutting our doors, because at this point the market is still crushing it. (Keep in mind I’ve only been in business for myself about seven years.) I did what I had to and started selling some of my unused equipment. My timing was perfect. When I sold this floor truss machine, I made 25,000 dollars, couple years later I would’ve been lucky to pass it off for $5,000. By this time I’ve moved all of my operations to my plant in Warsaw. (By March of 2009 housing starts to plummet to less than 500,000 annually) Then suddenly two years pass and I look like the smartest guy in the room as everything collapses. The market is no longer crushing it and things are getting bleak. No one could have predicted that things would have gone the way that they did and lasted so long.
I truly believe that God was looking out for my family and me. If I hadn’t been paying attention, I would’ve gone bankrupt and lost it all. Of course, I’d been paying attention and exercising common sense. If God hadn’t put me at my daughter’s volleyball game, I never would have had the notion to prepare like I did. What this leads to me believe is that God speaks to us, through our guts sometimes, and as my story can attest, it’s worth a listen. As you can see, I didn’t go bankrupt, but basically I was liquidated. That’s a story for another time. I did learn the value of sacrifice and vigilance. Always pay attention to things around you and if your gut tells you something’s wrong, listen to it.
