The typical costs included in a mortgage payment are principal, interest, taxes, and insurance. Principal: The amount you borrowed for your home and how much you have left to pay. Interest: The cost of financing your home. Taxes: Property taxes go towards funding local public services. Insurance: Homeowner’s insurance helps protect against significant costs in the event of a fire or other highly damaging events. Some people also choose to finance their closing costs, rolling those payments into their home mortgage loan.