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PITI stands for Principal, Interest, Taxes, and Insurance. It is the total monthly payment you make on a mortgage. Principal and interest pay down your loan. Taxes and insurance are typically held in an escrow account and paid by your lender on your behalf. Some lenders also include HOA fees in the monthly payment.

Your base payment (principal + interest) is calculated using the loan amount, interest rate, and loan term through an amortization formula. Each month, part of your payment goes to interest and part reduces the principal. Early in the loan, most of your payment goes to interest. Over time, more goes to principal. Property taxes and insurance are added to get your total PITI.

Amortization is the process of paying off a loan through regular payments over time. Each payment covers interest accrued since the last payment, with the remainder reducing the principal. A 30-year fixed mortgage is fully amortizing—by the end of the term, the loan balance is zero. Our calculator shows your amortization schedule for the first year.

A larger down payment reduces your loan amount, which lowers your monthly payment and total interest paid. It also builds instant equity and may eliminate private mortgage insurance (PMI) if you put down 20% or more. For investment properties, lenders typically require 15-25% down. Use this calculator to compare different down payment scenarios.

The interest rate is the cost of borrowing expressed as a percentage of the loan amount. APR (Annual Percentage Rate) includes the interest rate plus lender fees, points, and other charges, giving you the true annual cost. APR is higher than the interest rate and is the better metric for comparing loan offers. This calculator uses the interest rate for payment calculations.

Yes, if the property has HOA fees. While HOA fees are not part of your mortgage payment, they are part of your total monthly housing cost. Lenders consider HOA fees when qualifying you for a loan. For investment properties, HOA fees reduce your cash flow and should be factored into your analysis.

Most lenders require 15-25% down for investment properties, with 20-25% being typical. Putting down 25% often gets you the best interest rates. While a lower down payment preserves cash for other deals, it increases your monthly payment and reduces cash flow. Use this calculator to find the sweet spot for your strategy.

LTV is your loan amount divided by the property's appraised value. If you buy a $300,000 property with 20% down ($60,000), your loan is $240,000 and your LTV is 80%. Lower LTV means less risk for the lender and typically better rates. Most investment property loans require LTV of 75-80% or less.

Property taxes are typically paid monthly as part of your PITI payment, held in an escrow account. The lender pays your tax bill annually from this account. Tax rates vary by county and can range from 0.5% to over 2% of assessed value annually. For investors, property taxes are a major operating expense—research rates before buying in a new market.

This calculator shows your standard amortization schedule. To see prepayment savings, you would need to reduce the loan term or calculate the impact of extra principal payments manually. As a rule of thumb, paying one extra mortgage payment per year can shave 4-5 years off a 30-year loan and save tens of thousands in interest.