When people ask what their mortgage 'really' costs, the honest answer is PITI. It stands for Principal, Interest, Taxes, and Insurance, the four things most lenders roll into a single monthly payment. Miss any of them and your estimate will be too low, sometimes by hundreds of dollars.
Principal
Principal is the part of each payment that pays down what you borrowed. It starts small and grows every month as the balance falls. Principal is the part that builds your equity, the share of the home you actually own.
Interest
Interest is the lender's charge for the loan, calculated on the balance you still owe. Because the balance is largest at the start, early payments are mostly interest. Over time that flips, and more of each fixed payment goes to principal.
Taxes
Property tax is set by your local government as a percentage of the home's value. Lenders usually collect a twelfth of the annual bill with each payment and hold it in an escrow account, then pay the county when it is due. This is why your payment can rise on a fixed-rate loan: the tax assessment changed, not the rate.
Insurance
Homeowners insurance protects the property, and lenders require it. Like taxes, it is often escrowed and paid on your behalf. Premiums vary with location, the age of the home, and your coverage.
The two extras: PMI and HOA
Two more items sit alongside PITI. PMI, private mortgage insurance, is added when your down payment is under 20% and drops off once you reach 20% equity. HOA dues apply to condos and planned communities. Add them where relevant and you have the complete picture of a monthly housing cost.