The comments come from the main industry arbitration body, Financial Services Complaints Ltd (FSCL).
This organisation was considering the case of a couple who bought a house in 2020, using one adviser, and then another one, in 2022, using another.
This led to a claim for $3500 in clawback fees from the first adviser. The couple objected to this, and took a complaint to the FSCL.
In the course of the dispute, the adviser first halved, then cancelled the clawback claim. The couple accepted this and FSCL closed the file.
However, it urged all advisers to make sure they made clear that there could be potential payment of clawbacks.
FSCL said advisers' services were free to a customer, because they were paid by a bank. If the loan was repaid early, the bank could claim some of its payments to an adviser who could then in turn invoice the customer.
But it said many borrowers were completely unaware of this.
“As well as clearly disclosing the fee in the documentation, we encourage mortgage advisers to discuss the potential for a clawback fee with the borrower when arranging the finance,” FSCL wrote.
“The adviser should explain when a fee may be charged, the approximate amount of the fee and how the fee has been calculated.”
In its report on this case, FSCL disclosed information from the adviser that clearly revealed the possibility of clawback to the couple.
But the couple said they thought this referred to their bank loan, not to their dealings with the adviser.
An earlier version of this story incorrectly quoted FSCL as saying most mortgage advisers fail to tell clients about the possibility of clawbacks. In fact, this was stated by the complainants, not by FSCL.