Principal, Interest, Taxes, And Insurance
What Does Principal, Interest, Taxes, And Insurance Mean?
Principal, interest, taxes, and insurance, commonly referred to as PITI, are the monthly costs associated with owning a home. In terms of insurance, homeowners insurance, and sometimes mortgage insurance, are typically included in PITI expenses. These combined costs can represent a significant monthly expense, so it is crucial that homeowners ensure they can afford them before purchasing a home.
Insuranceopedia Explains Principal, Interest, Taxes, And Insurance
Homeowners insurance protects homeowners from losses that may affect their property, while mortgage insurance safeguards against the risk of defaulting on a mortgagee for various reasons. Homeowners insurance often includes liability coverage in addition to protection for damage to the property itself. Liability coverage protects against losses resulting from injuries occurring on the property. It is also common for homeowners insurance to cover unscheduled property, up to a specified dollar amount.
