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High housing costs have stalled many Americans’ homebuying plans in recent years. But mortgage interest rates have dipped below their recent peaks, offering prospective buyers some relief.
Despite this progress, economic uncertainties loom — which could affect the lending market. If you’re house hunting, knowing where rates might head this April could help you calculate potential monthly payments and set a realistic budget before you fall in love with a home.
See what mortgage interest rate you could qualify for here.
What’s the mortgage interest rate forecast for April 2025?
Mortgage interest rates in April will likely stay in the 6.5% to 7% zone, according to Steven Glick, a licensed mortgage loan officer and director of mortgage sales at HomeAbroad, a real estate agency. However, a couple of other scenarios could play out. We spoke with three industry professionals who broke down what economic conditions would trigger rates to rise, fall or hold steady in the coming weeks:
Mortgage rates could increase in April
These economic factors could push mortgage rates higher:
- New tariffs and inflation concerns: “Tariffs can have an inflationary effect, which may put upward pressure on mortgage rates,” explains Debbie Calixto, sales manager at mortgage lender loanDepot.
- Bond market reactions: “If inflation picks up from tariffs jacking up import costs, that could push the 10-year Treasury yield higher,” notes Glick. “Mortgage rates could follow that lead.”
- Strong economic indicators: Robust job reports or increased consumer spending could prevent the Fed from making more rate cuts. In other words, an overheating economy may increase mortgage rates.
Mortgage rates could drop in April
A significant Fed policy change might lead to lower mortgage rates. Here are three potential rate-reducing factors:
- Fed treasury purchases: “Starting in April, the Fed will slow down how quickly it’s pulling money out of the economy by cutting back on how many U.S. Treasuries it lets expire each month,” Calixto points out.
- Potential early rate cuts: While the Fed holds the federal funds rate steady at a range between 4.25% to 4.5%, it has hinted at two cuts in 2025. “If [it surprises] us with an early cut — or signal one’s coming — mortgage rates could dip in anticipation,” says Glick.
- Economic slowdown signs: “One thing that has brought [rates] lower in the last six weeks has been the ‘cracks’ starting to show in the economy, specifically the labor market,” highlights Arjun Dhingra, a licensed mortgage banker in charge of sales and business development at All Western Mortgage. Rising unemployment claims could prompt investors to seek safer bonds. This would likely push mortgage rates down.
See how low of a mortgage interest rate you’d currently qualify for now.
Mortgage rates could stay stable in April
The current economic picture shows mixed signals, which may keep mortgage rates stable:
- Fed’s cautious approach: “The Fed’s March 19 decision to hold rates steady, paired with [its] ‘wait-and-see’ approach'” to the new administrations policies “suggests [it’s] not rocking the boat yet,” Glick says. This careful stance helps maintain current rate levels.
- Modest economic growth: Lenders may hold rates steady if the economy continues at the current pace without triggering inflation concerns. “As long as [the 10-year Treasury] yield hangs around current levels, we’re likely looking at a flatline around 6.5% to 6.7%,” Glick predicts.
Economic indicators to watch in the coming weeks
Mortgage professionals recommend watching five factors closely if you’re buying a home soon:
- 10-year Treasury yield: “[This is] the heartbeat of mortgage rates,” explains Glick. “If it climbs, rates follow; if it drops, you might catch a break.”
- Consumer Price Index (CPI): This inflation gauge remains a top Federal Reserve priority. Higher inflation numbers could prevent rate cuts, while cooling inflation might encourage them.
- Jobs reports: The April 4 employment report could impact the market. “If unemployment increases and the economy shows [more] signs of a slowdown, you’ll get lower mortgage rates,” says Dhingra. Strong job numbers might keep rates higher.
- Consumer spending: Reduced consumer spending often signals economic cooling. “In response, mortgage rates may start to come down,” Calixto says.
- Federal Reserve signals: The next Fed meeting isn’t until May. But any statements or hints from Fed officials could move markets and mortgage rates.
The bottom line
Mortgage rates in April will likely stay steady, according to the experts we spoke to. They might ease later in 2025, but waiting could backfire if home prices rise or inventory tightens.
Your best move? Consult a few lenders now to understand your options. “Focus on your affordability,” Calixto advises. “If you find a home that fits your needs and the monthly payment is manageable, that’s a signal it may be the right time to buy.” Get pre-approved to know what you qualify for and be ready to act quickly. Remember, you can always refinance later if rates fall.
