PITI, or the sum of Principal, Interest, Taxes, and Insurance is an important metric in deciding how much home you can afford. Personal Capital breaks this down in the time it takes for your phone to re-charge and gives you some guidelines for making a sound financial decision. A good rule of thumb is that 28% of your gross monthly income should be the maximum monthly cash outflow for costs associated with your house payments. To calculate your PITI ratio, use our calculator.
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The While-You-Wait video series goes over important financial topics when life puts us on hold. Reheating your lunch? Rebooting your computer? That’s the perfect time to watch. Leave a comment on what topics you’d like to see us cover next.
To learn more about the many considerations involved in purchasing a home, read our free First-Time Home Buyer’s Guide.