Why PITI matters more than P&I
Most mortgage calculators show P&I — principal and interest only. That's the number lenders quote in ads because it's the lowest. But it's not what you actually pay each month. Add property tax and insurance and you get PITI — the real cash that leaves your account. PITI typically runs 15-25% higher than P&I depending on your state's tax rate. Underwriting a deal on P&I-only math is the fastest way to make a deal look more profitable than it is. (For a full breakdown of each piece, read PITI explained for rental property.)
The amortization formula
Where L = loan amount, r = monthly interest rate (annual rate ÷ 12), n = total months. Mortgages are fully amortizing — early payments are mostly interest, late payments mostly principal. On a 30-year mortgage at 7%, you don't cross the 50/50 principal-to-interest line until roughly year 19.
Investment property vs primary residence rates
Investment-property pricing can differ from owner-occupant pricing based on occupancy, property type, leverage, credit, reserves, points, term, lender, and market conditions. The FRED series shown by TrueCap is a national owner-occupied benchmark, not an investment-property quote. Enter a current written quote for the scenario you are evaluating.
Down payment scenarios
Minimum equity and pricing adjustments vary by loan program, occupancy, unit count, borrower, and property. Model the actual down payment from a current lender proposal; a cash scenario can be modeled separately by removing debt service.
Don't forget escrow + PMI
Mortgage-insurance and escrow requirements depend on the loan program and documents. Do not infer a premium or cancellation date from an equity percentage alone. Review the written loan estimate and program terms, then enter the actual premium, taxes, insurance, and escrowed items in the model.
The full picture
A mortgage payment is just one input in a real underwrite. You also need to know your DSCR (does the property cover the payment? — how to calculate DSCR explains TrueCap's preliminary ratio; lenders may use a different NOI and debt-service convention), cash-on-cash return (what does your money actually earn?), the upfront cash to close (estimate it with the closing cost calculator), and, when your access includes it, a released 10-year cash-flow and equity projection (how might the stabilized hold evolve?). TrueCap's free core analyzer combines the preliminary first-year rental metrics; evaluation and paid access gates apply to projection features.