Average mortgage rates have increased on Thursday, April 10, 2025, with the 30-year benchmark surpassing 6.7% and 15-year refinance rates climbing over 6%. The focus is now on the morning’s consumer price index to gauge if inflation is moving closer to the Federal Reserve’s 2% target. Economists anticipate the new inflation report to show a slight decrease compared to February’s 2.8% figure, amidst market turbulence following President Trump’s recent tariffs and growing concerns from Wall Street, leading some experts to suggest the U.S. may already be in a recession.
For those planning to enter the competitive spring housing market, it is recommended not to delay in seeking a mortgage to determine affordability and secure the best available rate. Presently, the average rate for a 30-year fixed mortgage sits at 6.72% for purchases and 6.81% for refinancing. Rates for a 15-year mortgage are at an average of 5.97% for purchases and 6.12% for refinancing. Jumbo mortgages have an average rate of 6.70% for 30-year fixed loans.
Mortgage rates are influenced by various factors, including inflation, economic conditions, housing market trends, and the Federal Reserve’s interest rate objectives. Lenders will also consider your credit score, down payment amount, property details, and loan terms when processing your application for either a 30-year or 15-year mortgage.
To capitalize on favorable rates, it is advisable to secure a mortgage rate when you are satisfied with the terms and conditions of your loan. Mortgage rates can fluctuate daily, so being proactive in finalizing your mortgage or home loan is advantageous.
Freddie Mac’s latest Prime Mortgage Market Survey shows a 30-year fixed-rate mortgage averaging 6.64%, with a slight decrease from the previous week’s 6.65%. Additionally, the fixed rate for a 15-year mortgage has decreased to 5.82%, down by 7 basis points from the previous week’s average of 5.89%.
Sam Khater, the chief economist at Freddie Mac, notes that the 30-year fixed-rate has stabilized recently with minimal fluctuations, leading to increased purchase application demand.
Factors such as inflation rates, economic conditions, housing market trends, and the Federal Reserve’s interest rate targets impact mortgage rates significantly. It is essential to monitor these factors when considering a new mortgage or home loan.
A slight change in your interest rate can result in significant savings over the life of your mortgage. The final rate offered to you depends on factors such as the specific mortgage product you are interested in, the initial payment you are willing to make, and your overall financial status, including your credit score. Understanding your credit score can help you identify lenders likely to approve your application and determine the most suitable mortgage for your financial situation. Borrowers with good to excellent credit scores (typically 670 or higher) are often offered the best rates, but even those with fair credit may find mortgages with competitive rates available.
The amount of money you put down as a down payment can also impact your interest rate. A down payment of at least 20% of the home’s purchase price usually results in a lower interest rate and can help you avoid mortgage insurance, reducing your overall costs.
The term of your loan is another crucial factor to consider. While the traditional 30-year mortgage is popular, shorter loan terms like 20, 15, or even 10 years may offer lower interest rates, although they come with higher monthly payments. On the other hand, longer mortgage terms can lead to smaller monthly payments but result in higher total interest paid over the loan’s life.
When it comes to interest rate types, mortgages can be fixed or variable. Fixed-rate mortgages maintain a consistent interest rate, while adjustable-rate mortgages (ARMs) typically start with a lower fixed rate before transitioning to a variable rate based on market conditions. The choice between fixed and variable rates depends on your financial objectives and risk tolerance.
Prequalification and preapproval are essential steps in the homebuying process. Prequalification provides a preliminary estimate of how much you can borrow based on basic information, while preapproval involves a more thorough financial assessment by a lender to determine the exact loan amount they are willing to offer.
Monitoring mortgage rates is crucial, as they are influenced by various factors including the federal funds target interest rate set by the Federal Reserve. While mortgage rates do not directly mirror the Fed rate, they are impacted by similar economic indicators considered by the Fed, such as inflation. As the Fed rate increases, mortgage rates often follow suit.
Following a series of rate hikes to combat rising inflation, the Federal Reserve recently announced a half-point cut to its federal funds target interest rate in September, signaling potential changes in mortgage rates in the near future.
After cutting rates by a full percentage point with three consecutive cuts in September, November, and December, the Federal Reserve paused its rate decreases for the second time on March 19, 2025. During the Fed’s second rate-setting policy meeting of the year, they announced the decision to maintain the federal funds target interest rate within the range of 4.25% to 4.50%. This pause in rate changes reflects the Fed’s commitment to bringing the inflation rate closer to the target of 2%.
In their post-meeting statement, the Federal Reserve emphasized their focus on achieving “maximum employment” and stabilizing inflation at 2%. They noted the stability of the low unemployment rate and solid labor market conditions, despite an increase in economic uncertainty. The Fed stated that they would carefully evaluate incoming data, the evolving economic outlook, and risk factors when considering any future adjustments to interest rates.
The Fed’s updated economic projections indicate plans for two quarter-point cuts in 2025, amid projections of slower growth and higher inflation in the coming months. As the next policy meeting approaches on May 6–7, 2025, market expectations suggest a high probability that the Fed will maintain rates within the current range.
Economists are closely monitoring inflation and labor reports for insights into potential future rate cuts by the Fed. Recent data showed a decline in the annual inflation rate to 2.8% in February, accompanied by a modest monthly increase in consumer prices. Job reports also exceeded expectations, with employers adding 228,000 jobs in March, though the unemployment rate experienced a slight uptick.
Federal Reserve Chair Jerome Powell acknowledged the heightened uncertainty in the economic landscape, particularly due to new tariffs, but emphasized the need for clarity before determining the appropriate path for monetary policy. Powell’s cautious approach indicates a wait-and-see stance as the Fed navigates evolving economic conditions.
The rate decision will be announced at the conclusion of the meeting on Wednesday, May 7, 2025, at 2 p.m. ET. Find out more about the upcoming Federal Reserve meeting, what to expect, and how it can impact your finances.
In other news, on April 23, 2024, a judge granted preliminary approval for a $418 million antitrust settlement with the National Association of Realtors, bringing an end to traditional real estate broker commissions of up to 6% of a home’s purchase price. Starting August 17, 2024, real estate agents will need to provide interested buyers with a representation agreement before showing a home. This agreement aims to bring transparency to the buyer-agent relationship, fees, and payment process. While this settlement is not expected to affect mortgage rates, it enables consumers to negotiate agent fees, potentially saving them money in the long term.
Explore more topics in our mortgage and homebuying series, including tips on shopping for a mortgage, types of mortgage loans, when to refinance, and the impact of rate changes on your mortgage. Learn about mortgage lenders, refinancing, homebuyer assistance programs, and adjustable-rate mortgages to help you make informed financial decisions.
Switching from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage is discussed in our refinancing guide. While negotiating your mortgage rate is unlikely as lenders consider market conditions and other financial factors, you can inquire about reducing costs through different means, such as mortgage points. These points, which involve upfront fees paid to the lender, can lower your interest rate by about 0.25% per point. Learn more about securing the lowest rate in our mortgage guide.
Regarding what happens to your mortgage after your passing, mortgages are usually settled through your estate before assets are distributed to heirs. In most cases, mortgages are not transferable, requiring the property to be paid off entirely to transfer the title. Learn more about post-mortem mortgage considerations.
If you own a home and need funds for major expenses, tapping into your home’s equity is an option to access cash at lower rates without refinancing. This approach requires good to excellent credit and sufficient equity in your home. Discover how to leverage your home equity as interest rates decrease.
Please note that the rates mentioned were accurate as of Thursday, April 10, 2025, at 6 a.m. ET, and may vary by region. Rates for certain products are subject to change.
Sources:
– Bankrate’s Mortgage Industry Insights
– Freddie Mac’s Primary Mortgage Market Survey
– U.S. Bureau of Labor Statistics’ Employment Situation Summary
– U.S. Bureau of Labor Statistics’ Consumer Price Index Summary
– U.S. Bureau of Labor Statistics’ Producer Price Index News Release Summary
– CME Group’s CME FedWatch Tool
