1. What is PITI?

PITI stands for Principal, Interest, Taxes, and Insurance - the four components of a typical monthly mortgage payment. This calculator also includes HOA (Homeowners Association) fees in the calculation.

2. How Does the Calculator Work?

The calculator uses the PITI equation:

Where:

• \( PI \) — Monthly principal and interest payment (USD)
• \( Taxes \) — Annual property taxes (USD)
• \( Insurance \) — Annual homeowners insurance (USD)
• \( HOA \) — Annual homeowners association fees (USD)

Explanation: The equation converts annual expenses (taxes, insurance, HOA) to monthly amounts and adds them to the principal and interest payment.

3. Importance of PITI Calculation

Details: Calculating PITI helps homebuyers understand their true monthly housing costs and ensures they can afford the property. Lenders use PITI to determine debt-to-income ratios.

4. Using the Calculator

Tips: Enter all values in USD. Principal + Interest is typically your base mortgage payment. Annual values are divided by 12 to get monthly amounts.

5. Frequently Asked Questions (FAQ)

Q1: What's included in PI?
A: Principal is the loan amount being repaid, and interest is the cost of borrowing. Together they make your base mortgage payment.

Q2: How do I estimate property taxes?
A: Check local tax rates or ask the seller for current tax amounts. Taxes are typically 1-2% of home value annually.

Q3: What insurance is included?
A: Homeowners insurance that covers property damage. Mortgage insurance (PMI) would be separate if applicable.

Q4: Are HOA fees always required?
A: Only if the property is in an HOA community. Enter 0 if no HOA fees apply.

Q5: Why calculate monthly PITI?
A: Lenders use this to ensure your total housing costs don't exceed a certain percentage of your income (usually 28-31%).