Finance
What is PITI in Nevada mortgage calculations?
APrincipal, Interest, Taxes, and Insurance — the four components of a typical monthly mortgage payment✓ Correct
BProperty Inspection, Title Insurance, and Initiation fees
CPrincipal Interest Tax Index
DPre-approval, Income, Title, and Insurance verification
Explanation
PITI stands for Principal, Interest, Taxes, and Insurance — the four components typically included in a monthly mortgage payment when the lender collects property taxes and insurance through an impound/escrow account. Lenders use PITI to calculate housing expense ratios.
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Key Terms to Know
Pre-Approval
A lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
EscrowA neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
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