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After the foundry closed in 1986, Diffie declared bankruptcy and sold the studio out of financial necessity.
He also divorced his wife, who left with their two children.
Diffie spent several months in a state of depression before deciding to move to Nashville, Tennessee.
There, he took a job at Gibson Guitar Corporation.
While at Gibson, he contacted a songwriter and recorded more demos, including songs that would later be recorded by Ricky Van Shelton, Billy Dean, Alabama and The Forester Sisters.
By mid-1989, he quit working at the company in order to record demos full-time.
Diffie also met Debbie, who would later become his second wife.
That same year, Diffie was contacted by Bob Montgomery, a songwriter and record producer known for working with Buddy Holly.
Montgomery, who was then the vice president of A & R at Epic Records, said that he wanted to sign Diffie to a contract with the label, but had to put the singer on hold for a year.
In the meantime, Holly Dunn released " There Goes My Heart Again ", which Diffie co-wrote and sang the backing vocals.
Following this song's chart success, Diffie signed with Epic in early 1990.

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