#3: How to break down your monthly mortgage payment - PITI explained
As a first time homebuyer, there's so much that we don't know until we're going through the process. Before I purchased my first home, I had never heard of P-I-T-I, which is your monthly mortgage payment. But now, I am super aware that the breakdown includes the Principal (P), Interest (I), Taxes (T), Insurance (I). If you plan to get a traditional mortgage like me, then you will likely be making monthly mortgage payments that reflect PITI as well.
Most of us are familiar with the Principal because it’s most similar to a rent payment. Where real estate and homeownership differ, is the I (Interest), T (Taxes), and I (Insurance).
So if you want to learn more about each of these, and how they are calculated, keep watching! I’ll tell you where to find them (i.e. on your closing disclosure), when they are due (taxes can be annual in some places), and what each of these means as it relates to your home.
Mortgage calculator (use the advanced settings to include HOA, homeowners insurance and taxes):
https://www.bankrate.com/mortgages/mortgage-calculator/
Instagram (we have lots of fun over here):
https://www.instagram.com/maximized.money
Ready to find the right real estate agent for you? Download my free checklist for questions to ask:
https://www.maximizedmoney.com/homebuyers-checklist
Want to get your finances together for your big home purchase? Join my free Homebuyer Goals Challenge:
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