Buyer's Guide
Lansing Area Real Estate
What's included in a mortgage payment

A monthly mortgage payment includes the following, known as PITI:        

  • Principal on the loan
  • Interest on the loan
  • Real estate Taxes
  • Property Insurance and, often, PMI (private mortgage insurance)

Excluding taxes and insurance, a typical mortgage payment consists of interest on the loan and payment towards the principal, or the unpaid balance of the loan.

The amount you pay towards interest and principal varies steadily over time. This is because mortgage loans work in such a way that during the first few years, most of the monthly mortgage payment will be applied to
the interest on the loan. During the final years of the loan, the payments will be applied primarily to the remaining principal. 

For example, the principle and interest for the monthly payment of a fixed-rate, 30-year, $100,000 mortgage loan at 7.5% interest is $699.21.        

  • $625 of the first payment is interest.
  • $74.21 of the first payment goes towards the principal.

Each successive payment will show a slight reduction in the amount paid toward interest with an equal increase in the amount applied to the principal. In the later years of the loan almost all the payment is applied to the principal.

The annual interest you pay on your mortgage, along with your annual property taxes, are a straight deduction on your Federal Income Tax return. 


Lansing, East Lansing, Okemos, Haslett, Williamston, DeWitt, Bath, Perry, Holt, Mason, Leslie, Dansville
Stockbridge,  Webberville, Grand Ledge, Charlotte, Olivet, Potterville, Eaton Rapids, St. Johns, Laingsburg, Owosso, Portland

2152 Commons Parkway, Okemos, Michigan 48864

Office:   517-324-3200
Fax:   517-324-3201
Toll Free:   877-326-3772


Contact Agents


Top level Real Estate services for...

  Bath Real Estate
Charlotte Real Estate
Dansville Real Estate
DeWitt Real Estate
East Lansing Real Estate
Eaton Rapids Real Estate
Grand Ledge Real Estate
Haslett Real Estate
Holt Real Estate
Laingsburg Real Estate
Lansing Real Estate
Leslie Real Estate
Mason Real Estate
Olivet Real Estate
Okemos Real Estate
Perry Real Estate
Portland Real Estate
Potterville Real Estate
St. Johns Real Estate
Stockbridge Real Estate
Williamston Real Estate
Webberville Real Estate

©TheLawtonGroup 2015

Lansing Michigan Homes For Sale | Relocation | Buying | Selling | MLS Search

Member of the Greater Lansing Association of Realtors
Michigan Association of Realtors       National Association of Realtors