Taxes and insurance pages explain recurring property costs and coverage requirements that affect mortgage approval, closing, and monthly payment. This section is limited to tax and insurance concepts that materially matter to residential mortgage borrowers.
Start with Private Mortgage Insurance (PMI), Mortgage Insurance Premium (MIP), and PITI to understand how recurring housing costs get translated into monthly mortgage language.
Then move through Property Taxes, Homeowners Insurance, Hazard Insurance, Flood Insurance, Upfront Mortgage Insurance Premium, and Annual Mortgage Insurance Premium to see how lender-required or lender-relevant housing costs show up in escrow, disclosures, and affordability decisions.
In this section
- Private Mortgage Insurance (PMI)
PMI is insurance typically required on certain conventional mortgages when the borrower makes a smaller down payment.
- Property Taxes
Property taxes are local taxes assessed on real estate that borrowers often pay through the monthly mortgage escrow process.
- Homeowners Insurance
Homeowners insurance is property coverage that protects against certain covered losses and is commonly required by mortgage lenders.
- Hazard Insurance
Hazard insurance refers to property-damage coverage that helps protect the home against covered physical perils.
- Flood Insurance
Flood insurance is property coverage for flood-related loss that may be required by a mortgage lender depending on location and risk.
- PITI
PITI stands for principal, interest, taxes, and insurance, a common shorthand for the core monthly housing payment components.
- Mortgage Insurance Premium (MIP)
Mortgage insurance premium is the FHA mortgage-insurance cost paid by the borrower, including upfront and ongoing components.
- Upfront Mortgage Insurance Premium (UFMIP)
Upfront mortgage insurance premium is the one-time FHA mortgage-insurance charge that is usually paid at closing or financed into the loan.
- Annual Mortgage Insurance Premium
Annual mortgage insurance premium is the ongoing FHA mortgage-insurance charge that is typically collected monthly as part of the housing payment.