Definition
An acronym for the four components of a total monthly mortgage payment: Principal, Interest, Taxes, and Insurance. Lenders use PITI to determine affordability and calculate debt-to-income ratios. On a $350,000 home with 10% down, typical PITI might be: Principal + Interest ($2,100) + Taxes ($290) + Insurance ($125) = approximately $2,515/month.
Related Mortgage Terms
- Amortization
The process of paying off a mortgage through regular monthly payments of princip...
- Debt-to-Income Ratio (DTI)
The percentage of your gross monthly income that goes toward debt payments, incl...
- Escrow
A neutral third-party account that holds funds during the home purchase process ...
- Annual Percentage Rate (APR)
The total annual cost of a mortgage expressed as a percentage, including the int...
- Appraisal
A professional assessment of a property's market value conducted by a licensed a...
Understanding mortgage terminology helps you compare loan offers and make informed decisions. Use our mortgage calculator to see how these terms affect your monthly payment.