What is PITI?
PITI stands for principal, interest, (property) taxes, and (property) insurance. Monthly mortgage payments commonly include all four costs. Some mortgage holders will not include taxes and/or insurance in the monthly payment, and the borrower must make arrangements to pay them separately. No matter how taxes and insurance get paid, the lender requires that you stay current on your payments. Brenda Procter, M.S., Consumer and Family Economics, College of Human Environmental Sciences, University of Missouri-Columbia If you’d like to learn more about this and other personal finance topics, the University of Missouri offers ‘Personal & Family Finance,’ a correspondence course, through the Center for Distance and Independent Study (800-609-3727). Information about this course is available at http://cdis.missouri.edu/CourseInfo/DetailCourseInfo.asp?1985. Can’t Find Your Question Here? Try Searching Our Quick Answer Knowledge Base Last update: Tuesday, July 22, 2008 University of Missouri log
This represents the accounts your money is applied to when you make your monthly mortgage payment: P Principal I Interest T Taxes I Insurance Back to top Q14: How do I know what loan is best for me? A14: Review your current situation and future goals, then answer the following questions to help determine the direction you may wish to take. Also, discuss these questions with your loan officer to help determine the type of loan you need. • How long do you expect to stay in the house? • Which is more important, low monthly payments, or low closing costs? • Will my income increase or decrease in the next three years? • How comfortable are you with your monthly payment potentially increasing? Back to top Q15: What is the difference between a fixed rate and adjustable rate mortgage? A15: With a fixed rate mortgage, the interest rate and payment remains constant over the life of the loan. Whereas, with an adjustable rate mortgage, the interest rate can either increase or decrease, based upon
