We hold these truths to be self evident!
There are truisms that we have all come to accept and believe in… as a young boy I cannot be sure where I heard them but they were inculcated into my thinking as far back as I can remember.
1. Work hard and everything will be alright
2. Do the right thing for the right reasons
3. Real-estate is a sure thing
I moved to Clinton, Oklahoma in 1982 from British Columbia, Canada and started a small animal veterinary clinic; Arrowcreek Animal Hospital. When I moved there we were in the midst of an “oil boom.” Houses were hard to find to buy and were almost double the price from the previous year. I set about looking for commercial property to buy and found an old bait shop that looked like it would work. If memory serves me, I paid 250 K for the bait shop/worm farm… but I had to remodel the whole thing. We moved a mobile home on to the same property to live in and remodeled the building. I did most of the work myself and the practice opened and was doing very well. People for the most part had money and were not afraid to spend it on their pets. Things started to fall apart in about 1985. In Oklahoma the economy was measured in the number of “active” drilling rigs in the state. As the price of oil dropped from 34$ a barrel to 14$ the economy tanked all within a six-month period. This economic downturn was not shared by all the United States just the oil producing states.
What did this mean for my family? Parts of this you can guess, making less money because a lot of people were out of work, cutting back my staff and tighten out belts in general. But just an importantly prices on my property that I purchased in 1982 now were half the price I had originally paid. But we were lucky because we were making enough money to continue to pay our monthly mortgages and feed our family.
I had borrowed money from a small bank in Cordell, Oklahoma named Cordell National Bank, from a man named Frank kliewer. https://obits.oklahoman.com/obituaries/oklahoman/obituary.aspx?n=frank-kliewer&pid=139867248 He was extremely accommodating for young veterinarian without a dime to his name and loads of student debt. He gave me a parking meter as a gift, not sure why he did, but I still have it. He tried to get me to borrow more money for the remodel, but I was to afraid to borrow more. Anyway in January of 1986 FDIC took over his bank and after reviewing all the documents they did something that even today seems odd to me, they called my loan on the veterinary practice even though I was current on my mortgage. Now if you are like me you have no idea what this means so I will elaborate. They wanted me to pay back or get a loan for my property from another bank. As I indicated earlier the property was not worth what I paid and there were not any banks that would loan money on a piece of property that they could not use a collateral. I did not have the cash to pay the difference, so I was forced to declare bankruptcy. https://oklahoman.com/article/2174465/lawsuit-filed-for-loans-secured-by-failed-bank
So why do I share this information with you? Because I still believe in these truisms but with a jaded eye. I work hard, I do the right thing for the right reasons and Real-estate can be a good purchase but you should not accept any of these at face value. You must do your do-diligence and look at all the factors and this is especially true as you have more money.
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