Present Values

[stb.]

After going around and around I have confused myself enough to ask for
help on this one.

What is the value today of 60 months of payments at $580 per month?
The total of the payments is over $34,000.

What is the value today of at change in interest rate from 5.99 to
6.125 on 697,000 for 120 months?

In each case I have assumed a discount rate equal to my new interest
rate of 6.125. I am not sure if that is correct to use or not, but in
any case using PV and NPV in excel I seem to be getting crazy answers,
like less than $20k for the first one and about $1500 for the second
one.

Any guidance here would be most appreciated.

stb.

[Bruce Raskin CPA]

Post by stb.
After going around and around I have confused myself enough to ask for
help on this one.
What is the value today of 60 months of payments at $580 per month?
The total of the payments is over $34,000.
What is the value today of at change in interest rate from 5.99 to
6.125 on 697,000 for 120 months?
In each case I have assumed a discount rate equal to my new interest
rate of 6.125. I am not sure if that is correct to use or not, but in
any case using PV and NPV in excel I seem to be getting crazy answers,
like less than $20k for the first one and about $1500 for the second
one.
Any guidance here would be most appreciated.
stb.

For the first one @6.125 the present vale is $29,910.82.

You have not furnished enoug information about the second amount to
calculate
the change.

I used a program called TValue5 to do the calculations.



.

[sbrinks]

The second question was the value today of an interest rate change. If
the interest rate on $697,000 was increased from 5.99 to 6.125% per
annum over 60 months (5 years) what is the present value of the
increase in the payment?

Any help?

stb.

Post by Bruce Raskin CPA

Post by stb.
After going around and around I have confused myself enough to ask for
help on this one.
What is the value today of 60 months of payments at $580 per month?
The total of the payments is over $34,000.
What is the value today of at change in interest rate from 5.99 to
6.125 on 697,000 for 120 months?
In each case I have assumed a discount rate equal to my new interest
rate of 6.125. I am not sure if that is correct to use or not, but in
any case using PV and NPV in excel I seem to be getting crazy

answers,

Post by Bruce Raskin CPA

Post by stb.
like less than $20k for the first one and about $1500 for the second
one.
Any guidance here would be most appreciated.
stb.

You have not furnished enoug information about the second amount to
calculate
the change.
I used a program called TValue5 to do the calculations.
.

[gmn9tt]

The present value of $697,000.00 over 120 months at 6.125% is:
$384,459.98.
The present value of $697,000.00 over 120 months at 5.990% is:
$389,568.52.

The difference is $5,108.54. I hope this is what you were asking and
that this helps.

Mike