This may be complex, so I hope I can explain it... A couple of years ago I relocated to a more expensive area and at the time my employer offered a pretty good relocation package. I got the legal fees paid (although had to use their appointed conveyancer, who was rubbish), the stamp duty paid, and I get two allowances in my pay packet for nine years. One is to cover the increased cost of utilities and council tax in my new area, and the other is calculated on the cost of the interest on the extra mortgage which I had to take out.
In the policy, it's very clear that this latter allowance is nothing to do with what actual mortgage product you choose, it's the difference in mortgage before/after multiplied by a centrally-decided interest rate which is something like the average of all the rates on the market. So you can shop around and take out a better product at, say, 4.1% but the rate they calculate your allowance is 6.1%. This lasts for 5 years and then tapers down by 20% each year as long as you are still employed with them and don't move house.
Ok so, I looked at the policy recently on the HR website. It is worth saying that very very few job moves now are eligible for this package. The current version says very clearly that if you suffer interest rate rises you can't ask for more on the allowance, and I remember that from the policy version that I signed up to (while being happy that I did actually get a five year fix that was and remains lower than their calculation rate).
What I don't recall, and will need to go digging through lots of files to find out if it was in the old policy, is a line which says that if you pay off some capital on your (new, increased) mortgage, you have to tell HR so that they can reduce your allowance. I might have been regularly overpaying a bit every year as habit, and yet still needed the assistance to move house in the case where there was a significant price differential.
Now, I don't see how they can realistically expect me to fess up to overpaying my mortgage if they didn't need me to fess up to having got a better rate than theirs at the beginning. There is only one instance in which they would get any access to my financial details (using the scheme to move again - vanishingly unlikely) so I am at nearly zero risk of them 'finding out' if I do at some point pay off some capital. WWYD?