Mortgage & Escrow Tool
The real cost of homeownership. Calculate your total PITI payment—Principal, Interest, Taxes, and Insurance—all in one place.
What is PITI?
I genuinely believe that the biggest mistake first-time homebuyers make is only looking at the loan payment. In the mortgage world, we use the acronym **PITI**: Principal, Interest, Taxes, and Insurance. These four elements together make up your actual out-of-pocket monthly cost.
The Role of Escrow: An escrow account is like a savings account managed by your lender. Every month, you pay a portion of your annual property taxes and insurance into this account. When those bills come due, the lender pays them on your behalf. This ensures the house stays insured and the taxes stay current, protecting the lender's investment.
Escrow Factors:
- Property Taxes: These vary wildly by state and county. Some areas are 0.5% of value, others are 3%+.
- Homeowners Insurance: Cost depends on location (flood/hurricane risk) and the replacement value of the home.
- PMI: If you put down less than 20%, you may also have Private Mortgage Insurance added to this escrow payment.