PRINCIPAL, INTEREST, TAXES & INSURANCE
Principal, interest, taxes and insurance (PITI) make up a typical house payment. Generally, the
loan payment includes extra funds collected by the lender to cover taxes and insurance. This
additional money goes into an impound account from which taxes and insurance are automatically
paid when they become due.
PRIVATE MORTGAGE INSURANCE
Private mortgage insurance (PMI) is provided by a private mortgage insurance company to protect
lenders against loss if a borrower defaults. Most lenders require PMI when the borrower's
down payment is less than 20% of the loan amount.
TAX DEDUCTIONS
Mortgage interest and property taxes are income tax deductions. Because they can significantly reduce
your income tax liability, this impacts the amount of money you can put towards your monthly payment.
Please see your tax advisor for details.
THE MORTGAGE CALCULATOR
Click on and drag the slider bars below to set the interest rate, the principal of your loan, and the
term of your loan. Your estimated monthly loan payment is shown in the lower left hand corner.
Note: The above payment does not include taxes or insurance.
Have questions that aren't answered here? If so, please
contact us now.
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