PITI

Definition

The four horsemen of monthly housing payments: Principal, Interest, Taxes, and Insurance. It's the total amount you'll shell out each month to keep a roof over your head and the bank off your back.

Example Usage

My PITI is $2,400 a month, which sounds terrible until you remember I was paying $2,200 in rent for a place half this size.

Origin

Mortgage industry acronym from the late 20th century

Fun Fact

Lenders use PITI to calculate your housing expense ratio, which ideally shouldn't exceed 28% of your gross monthly income—a guideline that makes millennials laugh and cry simultaneously.

Source: Mortgage lending terminology

Related Terms

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seller carry

When a property seller provides financing to the buyer, essentially acting as the bank and holding a note secured by the property. It's the real estate version of 'I'll spot you until payday'—except with six-figure stakes and actual paperwork.

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price per door

The total acquisition cost of a multifamily property divided by the number of rental units, providing a quick metric for comparing deals. It's how apartment investors reduce complex investments to a single number they can text each other.

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notice to quit

A formal eviction warning telling tenants to pay up, shape up, or get out. The landlord-tenant relationship's breakup letter, now with legal consequences.

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pocket listing clause

A contractual provision allowing agents to market properties privately before hitting the MLS, theoretically to preserve privacy but occasionally to preserve the agent's double commission. The VIP room of real estate.

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assessor

The government's official property stalker who determines how much your home is worth for tax purposes, usually right after you've renovated. These specialists combine questionable math with drive-by appraisals to decide your financial fate. They're like real estate agents, except they work for the taxman and nobody's happy to see them.

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gross rent multiplier

A quick property valuation metric calculated by dividing sale price by annual gross rental income, used to compare investment properties. It's the back-of-napkin math real estate investors use before getting serious with cap rates and cash flow analysis.

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