Hello! This is Joe Harris with Morgan Financial and here is your “Joe Knows Mortgages MINUTE”. This week, we answer the question: What is PITI?
PITI is an acronym for your payment and it stands for principal, interest, taxes and insurance. Principle is the part of your payment that reduces your loan balance. Interest is the part of your payment that goes to paying the interest on your loan. Taxes and insurance are the amount of your payment that is escrowed to cover the costs of your property taxes, and the cost to insure your property.
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