Humbled by Lonnie Yield Calculations - Posted by Ted (TK in N.Y.)

Posted by SusanL.–Fl on August 16, 1999 at 15:10:44:


Humbled by Lonnie Yield Calculations - Posted by Ted (TK in N.Y.)

Posted by Ted (TK in N.Y.) on August 15, 1999 at 18:37:10:

Hello folks.
My name is Ted, I’m new to this site-- and REI.(never done a deal) I’ve been faithfully following this news group for the past six weeks and devouring a ton of great information and wisdom. I have read many industry related books and materials–including most recently Lonnies two books on mobiles – of which I intend to pursue.

OK!! here’s my dilema (now many of you will probably laugh but some of you will hopefully relate)While reading Lonnies books he constantly gives examples of yields, on deals he’s done and he shows all his charts and such to support this. My problem is after countless hours of studying the calculator manual on yields and TVM in general I can not get my newly purchased Texas instruments BAII plus financial calculator to replicate his numbers!!!

Now don’t get me wrong I’m not blaming this fine piece of mathematical techno-gadgetry for my woes. I was in fact adult enough to admit that I must somehow be mathematically challenged. And with that thought in mind I turned to the mathematical gurus of my family for help (my wife and father). Surely they would be able to solve this riddle. Imagine my shock when after just a few short hours of frenzied,fruitless
calculations they too “fell” to the complexity of yield calculations.

I personally do not believe in intellectual laziness–the words: can’t,never,quit, etc… are usually not part of my vocabulary,but in this particular instance you are witnessing me crying uncle (< this is very rare so don’t get used to it!)

If anyone can direct me to a book that explains yields and other financial formulas in laymen terms ------- ( i.e “Financial calculations for Dummies”) or would be so kind as to post a reply or e-mail walking me through one of Lonnies’ deals in his book step by step with a financial calculator, I would be forever grateful.

I will sleep much better at night-- secure in the fact that I know my numbers and how to manipulate them, rather than out of “MY” ignorance having to rely on simply uttering the phrase “Good Enough” on every future deal that I do.

Thank you all in advance TK in N.Y.

Re: Humbled by Lonnie Yield Calculations - Posted by MIKE_SD

Posted by MIKE_SD on August 17, 1999 at 08:26:47:

Hello Ted, I have a killer booklet!
It is a quick reference booklet for the HP 12C.
The cost is about $6.00 and it is a goldmine of infromation. This little booklet can teach you various forms of financing in short order!
It will work with other types of calulators but
some thought as to what buttons to push will have to be addressed.
I purchased the booklet at a local outlet sometime back
Tams or something. However the address to order is:
Evan Gost
P.O.Box 2275
Saratoga,Ca 95070

Hope it helps everyone, it sure has taken the mystery out of financing real estate,notes,stocks and bonds

Also mystified by the calculations… - Posted by SusanL.–FL

Posted by SusanL.–FL on August 17, 1999 at 08:18:19:

Don’t feel bad! I also went out and bought myself a calculator that could do just about everything but bake bread…and I couldn’t figure out how to do the yield calculations either.

…but AIN’T Lonnie’s books GREAT!!

Stay tuned…you will see lotsa good M.H. info. from notables such as Dirk Roach, Reif, Scott, John Hyre, and many others. You’ll enjoy the all the postings.


Re: Humbled by Lonnie Yield Calculations - Posted by John(NH)

Posted by John(NH) on August 16, 1999 at 09:30:25:

Hi Ted,
I happen to have a TI BAII plus right here. Let’s see if I can walk you through it:
You buy a MH for $3000 cash and sell it for $6000 with $500 down and a note for $5500 at 12.75% interest for 3 years.
On your calculator, enter the following:

  1. 36 N
  2. 12.75 I/Y
  3. 5500 PV
  4. CPT PMT

Your buyer’s payment should come to -184.66.
Now that we have the monthly payment and the number of months, let’s figure out your yield. Since you’ve collected $500 down, you only have $2500 of your own moula in the deal. Some of the following you don’t have to reenter, but I’ll list them anyway:

  1. 36 N
  2. 2500 PV
  3. -184.66 PMT
  4. CPT I/Y

This is your yield, which should be 79.94%. Hope this helps!

Re: Humbled by Lonnie Yield Calculations - Posted by Reif

Posted by Reif on August 15, 1999 at 20:18:46:

I also have a TI BAII and had trouble at first.

I don’t remember exactly, but it may have been because there was a value in FV.

In many TMV calculations, FMV will equal zero.

Recommend press 2nd then FV (which is actually CLR TVM on the BA II), that will put zeroes in all five parameters, and then start again.

John Behle (host of the Cash Flow news group and an excellent teacher) says that if you have a question, many others probably have the same question yet were afraid to ask.

Why don’t you post your numbers here and let us examine the problem. While buying the book may be what you want to do, maybe we can help on a couple of specifics while you’re waiting.


Re: Humbled by Lonnie Yield Calculations - Posted by Ben

Posted by Ben on August 15, 1999 at 18:53:09:

Jim Napier’s “Invest in Debt” is a classic in this area. Also, I am sure John Behle who runs the cashflow
forum of this site can recommend some software like “Noteworthy” etc.