What is PITI?
PITI stands for principal, interest, taxes, and insurance. These are four of the major components that often shape the real monthly mortgage payment. Buyers who understand PITI usually have a much easier time making realistic affordability decisions.
What each letter means
- P = principal
- I = interest
- T = property taxes
- I = homeowners insurance
Why it matters
A lot of home buyers hear a principal-and-interest payment and assume that is the full monthly number. PITI is the reminder that taxes and insurance often need to be included too.
What PITI does not always include
PITI is helpful, but it still may not cover every housing cost. Depending on the loan and property, the full monthly payment may also include PMI or HOA dues.
For the broader explanation, read What Is Included in a Monthly Mortgage Payment?.
Related reading
Read What Is Homeowners Insurance? and How Property Taxes Affect Mortgage Payments if you want to understand the non-loan parts more clearly.
Try the calculator
Use the Mortgage Calculator to estimate a payment with taxes, insurance, HOA, and PMI included instead of only looking at principal and interest.
Final thought
PITI is one of the simplest ways to remember that a mortgage payment is often more than a loan formula. The more clearly you understand those components, the better your affordability planning becomes.