US Mortgage Calculator (PITI) 2026: Principal, Interest, Taxes, Insurance & PMI

Understanding True Housing Costs: The PITI Mortgage Formula

When purchasing a home in the United States, prospective buyers often focus solely on the advertised interest rate and loan amount. In reality, your actual monthly check to the mortgage servicer comprises four distinct parts known as PITI: Principal, Interest, Taxes, and Insurance.

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1. The Four Elements of PITI

1. Principal: The actual loan balance repaid each month, building equity in the asset.
2. Interest: The fee charged by the lender to finance the loan over 15 or 30 years.
3. Property Taxes (T): Local county, municipal, and school district property taxes collected monthly into an escrow account.
4. Insurance (I): Homeowners hazard insurance plus Private Mortgage Insurance (PMI) if your equity is under 20%.

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2. Verified Numerical Scenario: $400,000 Purchase with 10% Down

Consider the purchase of a $400,000 single-family home with a 10% down payment ($40,000), financed via a conventional 30-year fixed loan at 6.25% interest:

| PITI Component | Annual Total ($) | Monthly Escrow ($) | Calculation Details | |---|---|---|---| | Loan Principal Borrowed | $360,000.00 | — | $400,000 price minus $40,000 down | | Principal & Interest (P&I) | $26,606.88 | $2,217.24 | 30-year fixed amortization at 6.25% | | Local Property Taxes (1.25%) | $5,000.00 | $416.67 | County & school district millage rate | | Homeowners Insurance | $1,440.00 | $120.00 | Hazard policy escrow | | Private Mortgage Insurance (PMI) | $2,088.00 | $174.00 | 0.58% annual premium on $360k balance | | Total Monthly PITI Payment | — | $2,927.91 | Complete monthly servicing requirement |

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3. The 30-Year Amortization Curve & Total Interest Paid

Over the lifetime of this $360,000 loan:

• Total monthly payments across 360 months: $798,206.40
• Total interest paid to the bank: $438,206.40 (exceeding the purchase price of the property!).
• In Month 1: Of the $2,217.24 P&I payment, $1,875.00 goes entirely to interest, with only $342.24 paying down principal.
• In Month 180 (Year 15): The balance equalizes, with interest and principal roughly equal at ~$1,100 each.
• In Month 350: Over $2,100 of the payment goes directly to principal.

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4. PMI Cancellation Milestones

Because the buyer put down 10%, PMI is assessed at $174/month. Under federal law (Homeowners Protection Act):

• Borrower-Requested Removal: Can be requested in writing once the principal balance hits 80% of original value ($320,000), achieved in Month 63 (Year 5.25) with regular payments.
• Automatic Cancellation: The servicer must eliminate PMI automatically at 78% loan-to-value ($312,000), reached in Month 75 (Year 6.25), instantly saving $2,088 per year.

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5. Regulatory Sources & Verification

• Federal Mortgage Regulations: Consumer Financial Protection Bureau (CFPB) Real Estate Settlement Procedures Act (RESPA) & Truth in Lending Act (TILA). Verified on 21/09/2026.
• PMI Cancellation Standards: Homeowners Protection Act of 1998 (12 U.S.C. § 4901). Verified on 21/09/2026.

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6. Limitations of the Model

This model covers conventional fixed-rate financing. It does not include:

• Homeowners Association (HOA) fees or condominium dues, which are paid separately and not held in escrow.
• Adjustments for Adjustable Rate Mortgages (ARMs) after the initial fixed period expires.
• FHA mortgage insurance premiums (MIP), which generally cannot be removed for the entire life of the loan if down payment is under 10%.

Simulate your payments and amortization schedule:

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