Why So Many First-Time Buyers Are Overpaying Their Mortgages

A new study from TSB has revealed that a growing number of first-time buyers are keen to pay off their mortgage early — with 67% already making overpayments and many aiming to be mortgage-free by the age of 40.

According to the research, today’s buyers are more focused on clearing their mortgage than on saving for retirement. In fact, 68% said becoming mortgage-free is their top financial goal, compared to just 25% who prioritise boosting their pension.

How First-Time Buyers Are Paying Off Their Mortgages Sooner

The survey, carried out by Censuswide among more than 1,000 people who’ve bought their first home in the past five years, found that 57% hope to shorten their mortgage term.

Of those making overpayments:

• 43% do so every month,

• Most pay an extra £200–£399 each time, and

• Around 9% have made lump-sum payments between £1,000–£2,499 to get ahead on their mortgage.

Others are finding creative ways to reduce their term — from stricter budgeting and taking second jobs, to cutting back on holidays or even reducing pension contributions in the short term.

The Barriers to Overpaying

Not everyone can afford to overpay, though. For around a third (33%) of first-time buyers, affordability is the main obstacle. Others prefer to keep an emergency buffer, are saving for a family, or simply value enjoying life now — spending on travel, socialising, and lifestyle costs.

A Balanced Approach

Craig Calder, Director of Mortgages at TSB, commented:

“Recent first-time buyers are prioritising overpayments over building up savings, pension contributions and holidays, in the hope of becoming mortgage free earlier in life.

Overpaying can be a great way of shaving years off your mortgage, and we’d advise building this into your wider financial plan that ensures money confidence across savings, budgeting and a pension.”

The Takeaway

If your goal is to pay off your mortgage early, overpayments can make a big difference — even small, regular amounts can reduce your term and save thousands in interest.

But it’s important to take a balanced approach. At J Finance, we can help you review your mortgage, assess your budget, and ensure your overpayment strategy fits alongside your other financial goals, such as savings, protection, and retirement planning.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.