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PITI

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PITI
Stands for principal, Interest, taxes and insurance-the components of a monthly mortgage payment.
    
In relation to a mortgage, PITI (pronounced like the word "pity") is an acronym for a mortgage payment that is the sum of monthly principal, Interest, taxes, and insurance. Principal is the amount borrowed or remaining unpaid; also, that part of the monthly payment that reduces the outstanding balance of a mortgage. Interest is  the cost of borrowed money. A Tax is a financial charge or other levy imposed on an individual or a legal entity by a state or a functional equivalent of a state .
    
Lending institutions often use a multiple of the PITI payment amount as the minimum amount of seasoned assets a borrower must document ("state") as a reserve when qualifying for a mortgage.
Posted by  Privatebanking.com
 
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