A study of more than 1,000 first-time buyers carried out by Censuswide on behalf of TSB found that 57% of respondents wanted to shorten their mortgage term.
Some were working towards this, as 67% said they were making mortgage overpayments. Of those making overpayments, 43% did this monthly.
A fifth of people made overpayments between £200 and £299 each time, while 17% paid an additional £300-399. Just 9% made lump sum overpayments between £1,000 and £2,499.
To reduce the length of their mortgage, recent first-time buyers said they were saving more or planning to save more, as mentioned by 57% of respondents. Some 55% were becoming stricter with budgeting and 29% had taken a second job. A further 29% were skipping out on holidays and spending on lifestyle, while 18% reduced their pension contributions. Just 3% said they were not doing anything to shorten their mortgage term.
The survey revealed how important the mortgage was to new homeowners, as 68% said paying it down was a bigger priority than boosting their pension pot, which was only cited by a quarter of respondents as their main focus.
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TSB’s first-time buyer customers get younger
TSB also looked at its first-time buyer data for Q3 and found that both the average mortgage term and age of borrowers had reduced from 32 years to 31.
At 33, London had the highest average age of first-time buyers, while Wales and Scotland each had the lowest at 30.
TSB also recorded the most completions in the South East and Scotland, each with a share of 16% of business in Q3. This was followed by the North West, which made up 11% of completions over the period.
The fewest completions were seen in East Anglia, Wales and the East Midlands at 4%, 5% and 7% respectively.
The bank also identified a gap between the average deposits needed from first-time buyers, with London at £140,000, compared to £18,000 in the North East and £24,000 in Wales.
Craig Calder, director of mortgages at TSB, said: “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.”
