What is P.I.T.I


What is P.I.T.I?.

 

What is P.I.T.I?

September 17, 2012

When you’re buying or selling a house, there are many terms that come up. Though your local REALTOR can guide you through much of the terminology, there are some terms that you should be familiar with, and PITI is one of them. You will see PITI associated with your loan documents and mortgage paperwork. The following is an explanation of the term and the meaning of each of its letters.

P is for Principal
The principal is the total base amount of money that you are borrowing to buy your home. The principal is generally the biggest portion of the PITI figure.

I is for Interest
Whenever you borrow money or pay on credit, you have to pay an interest charge. The interest is usually calculated as a percentage and appears as an amount on the PITI breakdown. Depending on the deal you have, the interest rate can stay fixed for the term of the loan or it can be variable.

 T is for Taxes
Taxation is one of the eternal certainties of life! Taxes involved with home ownership typically go to governments at the local level to pay for public services. The tax amounts are typically included with the monthly mortgage prorated. The lender pays the tax on your behalf to the local government.

The other I is for Insurance
Your home is one of the biggest investments you will make, and a homeowner’s insurance policy is vital for your financial well-being. There are various policies from which you can select, but the choices available to you depend on how much money you put down on your property. If you make a down payment of less than 20%, lenders require that you purchase private mortgage insurance (PMI).  This protects the lender in the event of loan default or foreclosure. Similar to the way it is with taxes, these payments are generally added into your total mortgage payment.

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Author: Louisville Kentucky Mortgage

I have helped over 589 Kentucky families buy or refinance their home over the last 18 years. Realizing that this is one of the biggest, most important financial transactions a family makes during their lifetime, I always feel honored and respected when I am chosen to originate their personal home loan. You can count on me to deliver on what I say, and I will always give you honest, up-front personal attention you deserve during the loan process. I have several advantages over the large banks in town. First, I can search and negotiate for your loan options through several different mortgage companies across the country to get you the best deal locally. Where most banks will offer offer you their one set of loan products. I have access to over 10 different mortgage companies to broker your loan through to get you the best pricing and loan products that may not fit into the bank's program due to credit, income, or other underwriting issues. You will not get lost in the shuffle like most borrowers do at the mega banks; you're just not a number at our company, you are a person and we will treat you like one throughout the entire process. Give us a try or let us compare your options on your next mortgage transaction. Call me locally at 502-905-3708. Free Mortgage Pre-Qualifications same day on most applications. Email me at kentuckyloan@gmail.com with your questions I specialize in Kentucky FHA, VA ,USDA, KHC, Conventional and Jumbo mortgage loans. I am based out of Louisville Kentucky. For the first time buyer with little money down, we offer Kentucky Housing or KHC loans with down payment assistance. This website is not an government agency, and does not officially represent the HUD, VA, USDA or FHA or any other government agency. NMLS# 57916 http://www.nmlsconsumeraccess.org/ Joel Lobb Senior Loan Officer (NMLS#57916) American Mortgage Solutions, Inc. 800 Stone Creek Pkwy, Ste 7, Louisville, KY 40223 phone: (502) 905-3708 Fax: (502) 327-9119 kentuckyloan@gmail.com Company ID #1364 | MB73346 http://mylouisvillekentuckymortgage.com Equal Housing Lender

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