Understanding Mortgage Calculations (PITI)
Learn how to calculate your true monthly house payment.
What is PITI?
When you buy a house, your monthly payment consists of four main components, commonly known as PITI:
- Principal: The portion of your payment that goes towards paying down the actual loan amount.
- Interest: The cost charged by the lender for borrowing the money.
- Taxes: Property taxes charged by your local government, usually divided into 12 monthly installments.
- Insurance: Homeowners insurance to protect your property against damage.
How to use our Advanced Mortgage Calculator
Simply enter the total price of the home, your down payment, and the expected interest rate. Add your yearly property tax and insurance estimates to see an accurate monthly breakdown.