Posted on: 02nd Dec, 2012 09:28 pm
OK just got my FHA loan finalized and need to understand about payment. i don't think my lender was upfront with me.
I understand payment consist of principal; interest and mortgage insurance. But does it needs to include property taxes and homeowrner's insurance?
I think my lender added homeowner's insurance by mistake b/c I had to obtain one to show proof to the underwriter and paid it already. hmm that is something I will need to let him know.
and I thought property taxes is something I can pay separately on my own.
any answer will be greatly appreciated.
I understand payment consist of principal; interest and mortgage insurance. But does it needs to include property taxes and homeowrner's insurance?
I think my lender added homeowner's insurance by mistake b/c I had to obtain one to show proof to the underwriter and paid it already. hmm that is something I will need to let him know.
and I thought property taxes is something I can pay separately on my own.
any answer will be greatly appreciated.
Welcome quocwen,
The mortgage payments constitutes of 4 components - Principal, Interest, Taxes and Insurance (PITI). The principal amount includes the money used to pay down the loan balance. Interest is the charge you pay to the lender for borrowing the money; taxes includes the property taxes you pay as a homeowner and insurance refers to both your property insurance and your private mortgage insurance.
The mortgage payments constitutes of 4 components - Principal, Interest, Taxes and Insurance (PITI). The principal amount includes the money used to pay down the loan balance. Interest is the charge you pay to the lender for borrowing the money; taxes includes the property taxes you pay as a homeowner and insurance refers to both your property insurance and your private mortgage insurance.
Hi quocwen!
Welcome to forums!
I don't think you will have to pay property taxes on your own. If an escrow account has been created for you, then the amount will get deposited in that account after you pay your PITI.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
I don't think you will have to pay property taxes on your own. If an escrow account has been created for you, then the amount will get deposited in that account after you pay your PITI.
Feel free to ask if you've further queries.
Sussane
You have to pay the property taxes and the homeowner's insurance on your own. Anyways, to get a better idea of the different components of PITI, go through this page - http://www.mortgagefit.com/piti.html
Basic things have already been stated but you must study your documents thoroughly for understanding the procedure and then if you have any query feel free to ask.