All Forum Posts by: David de Luna

May I ask you what is the difference between your average annual return and your CoC return? What's the difference between the two calculations?

@Sam Grooms, I'm starting to follow now (and forgive me @Matthew Shay for hijacking your thread. I've been wanting to dig deeper into understanding IRR related to RE investing and now I'm in front of someone who knows what they are talking about), so... I understand the sales price, of say, 245k (under contract now on a 7 unit), then what number is my loan repayment you refer to? I know what my mort pmt is and the total payments that would be made over 10 years, so is that my number - 10 years worth of mort pmts? (that can't be it, because you're referring to acquisition) Then add back in deposits, reserves I got back at close = acquisition cash outflow? I have a good spreadsheet that gives me my CoC, Cap rate, GRM, DSCR, etc. but it's IRR that I've never used but feel like I should be looking at this number too. Just never got how to calculate it. Thanks again, I really appreciate it.

@Sam Grooms thank you so much. If I could run a few things by you....

My spreadsheet shows my pretax cash flow starting at year 1, not at acquisition, since at close there's no income yet. Is my year 1 cash flow what you refer to as "at acquisition"?  Then, "cash received" would refer to the difference between what I paid for the property and what I sold it for minus selling costs? Thanks again. I really appreciate it.

Tapping into this impressive braintrust, can someone show me what a 10 year IRR formula looks like? I am familiar with Excel, just want to make sure I build the formula correctly.,

Even if the appraisal is less that 30 days old?

I'm in contract on a 7 unit deal. One lender who made an offer wants an appraisal by any certified appraiser. If I change my mind about this lender, would another commercial lender use the appraisal or would I have to pay for another appraisal? 

I should probably have said that I'm in contract for a Texas MF. Someone mentioned that I should form a TX LLC due to this. Not sure one necessarily follows the other.

I need to form an LLC. Apparently my commercial lender will only fund to an LLC. This is my first commercial deal so I'm learning fast. Any recommendations for forming an LLC in AZ or TX - I'm referring to an atty or some such outfit to help make it happen quickly. Thanks.

I should also say that I live in the SF bay area. This is ab out of state purchase.

This is an investment purchase. I live in the SF bay area, buying rental property in El Paso. Under contract now for $245k, awaiting rent roll but 6 of 7 units are rented. Looking for max leverage. Not looking for hard money, but a commercial loan.

Please contact me at david at delunatic dot com for particulars.

Thanks.