The prepayment is a small amount of credit we've built up on the account. e.g. The mortgage is €1400 a month, We pay €1500 we build up €100 in prepayment credit. (not actual figures).
Up to the official adjustment, they were taking this figure into account - e.g. we had €2,000 in prepayments on the account, the actual outstanding balance was €200,000 but we were being charged interest on €198,000 because they were taking that €2,000 of our money into account, it wasn't paid off the principle, but they had control of it.
If need be, we could use it to pay off the principle or use it in an emergency to make that month's full or partial payment.
So they were taking it into account all this time and now suddenly aren't. So we were paying interest on a slightly lower principle figure (which over time could have been equal to a mortgage payment in saved interest), and now they're still holding onto that money - it's in the T&Cs that it can't be refunded, but we aren't benefiting from it.