PITI stands for Principal, Interest, Taxes, and Insurance — the four components of your true monthly housing cost. Lenders use PITI (not just principal and interest) to determine how much you can afford. This calculator shows a full PITI breakdown so you can plan realistically.

Private Mortgage Insurance (PMI) is typically required when your down payment is less than 20% of the home price on a conventional loan. You can avoid PMI by making a 20% or larger down payment, or request removal once your loan-to-value ratio reaches 80% through payments or appreciation.

A fixed-rate mortgage keeps the same interest rate for the entire loan term, giving predictable payments. An ARM starts with a lower introductory rate for a set period (e.g., 5 or 7 years), then adjusts periodically based on a market index. ARMs carry the risk of payment increases after the fixed period ends.

Conventional loans typically require 5% to 20% down. FHA loans allow as low as 3.5% with qualifying credit. VA and USDA loans may offer 0% down for eligible borrowers. A larger down payment reduces your loan amount, monthly payment, and total interest — and may help you avoid PMI.

Closing costs generally range from 2% to 5% of the purchase price. They include lender fees, appraisal, title search and insurance, recording fees, prepaid property taxes and insurance, and escrow funding. Ask your lender for a Loan Estimate to see itemized costs early in the process.

Pre-approval is a lender's conditional commitment to lend you a specific amount based on your credit, income, and assets. It strengthens your offer in competitive markets, helps you set a realistic budget, and speeds up the closing process. Gather pay stubs, W-2s, bank statements, and tax returns before applying.

A longer term (e.g., 30 years) means lower monthly payments but significantly more total interest. For example, a $300,000 loan at 6.5% costs about $382,000 in interest over 30 years versus about $173,000 over 15 years — a difference of over $200,000. Use the calculator to compare scenarios side by side.

An amortization schedule shows how each monthly payment splits between principal and interest over the life of the loan, plus the remaining balance after each payment. In the early years, most of your payment goes to interest. As the loan matures, more goes to principal. This calculator generates a full month-by-month schedule.

Most lenders collect property taxes through an escrow account as part of your monthly payment (the "T" in PITI). Tax rates vary widely by location — from under 0.5% to over 2% of home value annually. A property tax increase can raise your monthly payment even if your interest rate stays the same.

Most lenders prefer a front-end DTI (housing costs / gross income) below 28% and a back-end DTI (all debts / gross income) below 36% to 43%. FHA loans may allow up to 50% back-end DTI with compensating factors. Use this calculator to check whether your projected PITI fits within these guidelines.

Extra payments reduce your principal faster, which lowers total interest and shortens the loan term. Even one extra payment per year on a 30-year mortgage can save tens of thousands in interest. Most US conforming loans have no prepayment penalty, but verify your loan terms first.

Run your base scenario in the calculator, then test with the interest rate 2 percentage points higher and property taxes or insurance increased by 10% to 20%. If your budget still works under stress conditions, your mortgage plan is more resilient to market changes.