As a mortgage broker or lending partner, 2025 is looking like the kind of year where interest rate movements are going to make or break deals. With the Federal Reserve's cautious approach to rate cuts, inflationary forces, and changing economic policies, private lending is no longer just an alternative; it's a necessity for getting deals done in today's volatile environment.
RCN Capital has analyzed the data and listened to partners just like you. This is what we are witnessing:
We'll explain how interest rate changes are affecting private lending in this blog, what that implies for your company, and some practical ways to prosper in 2025. Let's get started!
As of April 2025, the housing market in the U.S. is going through a phase of relatively stable mortgage rates. The 30-year fixed rate for mortgages is down slightly, averaging 6.6%, compared to recent months where it was slightly higher. Part of the drop is due to economic uncertainties that include continued tensions over trade as well as ongoing tariff implementations from the Trump administration.
The Federal Reserve has maintained rates at 4.25%-4.5% since March 2025, with just two planned cuts by year-end. Though this is a reversal from the aggressive cuts in 2024, it represents cautious optimism against persistent inflation and geopolitical risks such as possible tariffs.
Why it matters for brokers:
Despite Fed cuts, 30-year fixed mortgage rates remain elevated:
|
Source |
2025 Forecast |
2026 Forecast |
|
Fannie Mae |
6.5% |
6.2% |
|
National Association of Realtors |
6.4% |
6.1% |
|
Wells Fargo |
6.53% |
6.46% |
This “higher for longer” environment means borrowers need creative solutions—fast.
With traditional financing lagging, hard money loans are surging. Here are just some of the benefits:
For private lenders and brokers, these interest rate fluctuations provide challenges as well as opportunities:
Rising rates compress investor margins, but brokers who offer niche loan products win:
Pro Tip: Employ RCN Capital's BLN Software to configure loans with real-time rate updates and transparent terms.
Lower forecast rates in late 2025 could trigger a wave of refinancing. For instance:
The current economic environment, driven by global trade policies and geopolitical tensions, indicates probable fluctuations in interest rates. Brokers need to plan for probable fluctuations that could affect their lending strategy.
Expected reforms, like the modification of lending buffers, might change the pattern of lending, influencing how risk and borrower eligibility are determined by brokers.
While office spaces struggle (delinquency levels reach 9.37% in 2024), other asset classes prosper:
Broker Opportunity: Establish yourself as an expert in fast-growing categories such as logistics or built-to-rent neighborhoods.
With volatility likely, offer rate locks to provide stability:
Tools like RCN Capital’s broker portal let you:
Partner with professionals who drive referrals:
2025 is set to be a dynamic year in the world of real estate. While interest rate movements work in favor of nimble lenders, agents who adopt private lending will take center stage. Here are the top takeaways:
When rates change, brokers require a lender that offers speed, adaptability, and dependability. Here's how we assist:
Ready to take your brokerage to the next level? Connect with us today to discuss our real estate financing solutions and how we can help you grow your business