|
Q
:
|
What does my mortgage payment include? |
|
A
: |
A monthly housing payment generally consists of four parts commonly referred to as PITI, or Principal, Interest, Taxes, and Insurance. Another important factor affecting your payment amount is if you are required to pay monthly (MIP) mortgage insurance premium. A mortgage lender will identify all the components of the mortgage loan payment based on the type of loan determined to best serve your needs.
|
| |
|
Q
:
|
How much cash will I need to purchase a home? |
|
A
: |
You will generally need the down payment, closing costs and prepaid expenses based off the purchase price and expenses associated with the home you wish to purchase. The estimated closing costs and down payment amount will be totaled and disclosed in the Good Faith Estimate and Truth in Lending documents provided to you by your mortgage lender. Right before the closing you will be given a settlement statement telling you the exact amount needed. Any earnest money and other fees already paid will be credited and result in a reduction of the initial estimate of cash needed on closing day.
|
| |