what is piti

PITI is an acronym that stands for principal, interest, taxes, and insurance, and it is used in relation to a mortgage. Specifically, PITI is the sum of the monthly loan service (principal and interest) plus the monthly property tax payment, homeowners insurance premium, and, when applicable, mortgage insurance premium and homeowners association fee. PITI is the monthly "bottom line" of what is called a "mortgage payment". Lenders use PITI to determine if a borrower qualifies for a mortgage, and generally prefer the PITI to be equal to or less than 28% of a borrowers gross monthly income. PITI is also used to estimate the full cost of owning a home.