Just to add - I'm counting my lucky stars that I get the 6.08% in the first place so if the bank want to keep any overpayment to reduce my arrears then i'll be happy with that!

Hi BlurredX - Yes I am getting the 6.08% but it hasn't started yet - think its the 31st March so i'll let you know about what happens to the overpayment. From what I can gather, different banks seem to have different policies regarding the overpayments. HSBC did tell me they would credit back to my account but to be honest trying to actually find out about how the whole procedure works has been a real struggle. Like you say - the money isn't a payment to the bank, it's a payment to you to pay your mortgage. The money goes directly to your bank to ensure that it actually gets paid and any overpayments should be directed back to you. I'll keep you posted!!

That certainly does help!! I have submitted the forms but at the moment I am only in my 4th week of receiving income support so another 9 to wait!! Thanks for everyone's help on this!!

Thanks for your help on this. BTW nk22 - I have asked my bank (HSBC) that if the interest payment from DWP covered more than my interest due where would the extra go?? They advised me that it would be credited back to my Bank Account. I don't know whether different banks have different policies but I can understand your point that if anyone is going to benefit from the extra it should be you and not the bank.

Hi BlurredFX - do you know for sure that the 6.08% is a fixed rate rather than a ceiling rate?? I am currently in the 13 week waiting period and it is my understanding also that the rate is fixed so if your interest rate is less than 6.08% then the extra is deposited back to your bank account and can go towards paying off the capital!! Saying that - I have also read that if your mortgage rate is a lot less than 6.08% (5% or less) they will only pay the interest charged by your bank. I have tried to ask my bank, the job centre, and tried to find the answer on dwp website but nobody seems to know the answer (shock!!) Now my interest rate is only 0.5% so although it would be great if they paid 6.08% I just can't see how they can!! As you have just been through this procedure I wondered if you could help me any further??