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Mortgage FAQs



What is PITI ?

PITI is a term commonly used in the mortgage industry that stands for principal, interest, taxes, and insurance.  These are the components that make up your monthly mortgage payment to the lender.  PITI is part of the financial analysis to determine your ability to repay the mortgage along with your income and other expenses.

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What is an Interest Rate Lock ?

This is a process where the mortgage lender guarantees a certain interest rate for a period of time thus eliminating any market fluctuations.

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What are Discount Points ?

Discount points are front end fees paid to the lender to reduce the interest rate.  A discount point is equal to 1% of the loan amount.

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What is Private Mortgage Insurance ?

Private Mortgage Insurance is a monthly insurance premium required by lenders for borrowers where the loan to value ratio exceeds 80%.

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What is a Pre-Qualification" ?

Pre-qualification is a process where the mortgage company makes an estimate as to the loan amount an individual may qualify for based on certain financial information supplied to the mo