Sarah, a first-time homebuyer in Vancouver, applies for a high-ratio mortgage. Her mortgage agent, David, notices that Sarah's T4 income statement for the previous year shows significantly less income than what's stated on her employment letter, which appears to be recent. What should David's immediate course of action be regarding this discrepancy?

Question: Sarah, a first-time homebuyer in Vancouver, applies for a high-ratio mortgage. Her mortgage agent, David, notices that Sarah's T4 income statement for the previous year shows significantly less income than what's stated on her employment letter, which appears to be recent. What should David's immediate course of action be regarding this discrepancy?

Answer options: ✅ Document the discrepancy and request further clarification and supporting documents directly from Sarah's employer.

• Proceed with the application, assuming the employment letter reflects her current, higher income.
• Advise Sarah to get a new employment letter that aligns with her T4 income.
• Ignore the T4 and focus only on the employment letter for income qualification.

Correct answer: Document the discrepancy and request further clarification and supporting documents directly from Sarah's employer.

Explanation: Mortgage agents have a responsibility to act honestly and with integrity, and to address red flags related to income discrepancies by seeking clarification and corroborating evidence, as per suitability and anti-fraud guidelines.