What does 'PITI' stand for in mortgage lending?

PITI stands for Principal, Interest, Taxes, and Insurance — the four standard components of a typical mortgage payment. Principal repays the loan balance; interest is the cost of borrowing; taxes are property taxes collected by the lender and held in escrow to pay the local government; insurance is homeowner's insurance (and sometimes private mortgage insurance, PMI, when the down payment was below 20%). Lenders use PITI as a stand-in for the borrower's total housing cost when calculating debt-to-income ratios for qualification. Some borrowers pay taxes and insurance themselves rather than escrowing through the lender; that arrangement is allowed when the down payment is large enough.