I found a 6 unit that "supposedly" gross 40K. So I ask for the income and expense statements, not sure what they are called in the real world, and the agent says that owner managed the property himself for the last 10...

I believe the approach you described of using the market cap rate against your increased NOI to determine the increased value of your property is more appropriate for commercial buildings (5 units and up).

I'm not sure if lenders lend on multiply properties being sold in a package deal so I'm not sure on which lenders to approach just yet. 

We are also looking for private lenders. what is the best approach in reaching out to private lenders in the south florida area

I would happily offer my own state's approach on these kinds of issues, but I don't think it would be that helpful to whomever is asking the questions.

Is there anything wrong with taking such an approach.

Any veteran investors willing to give some tips on how to approach an acquisition of a SFR via auction? 

For the sports fans out there:"You'll always miss 100% of the shots you don't take." -- Wayne Gretzky

Understand your approach, but at the end of the day (assuming we're discussing analysis in support of a BUY vs WALK decision), in my opinion, IRR(Internal Rate of Return) is too academic and the NPV(Net Present Value) has factors one can adjust.We see lots of newbies just learning to calc cash/cash & cap rates and these are sufficient to make the go/no decision, using the K.I.S.S principle.Attempting to add IRR & NPV to the learning curve is not a requirement - - for you, it's another confirmation you're on the right track.

I always ask for rental history on properties for my clients and am thorough in my approach.