Credit Issues of my own doing

Hello, I so I have maybe a unique case. In February of 2017 I started looking at my savings or the lack there of and all the money in credit cards I was paying for with high balances and no end in sight of getting out. I always made good money but never could save enough money since I had a lot of credit debts and student loans. So in February of 2017, I decide to use National Debt Relief (NDR) to get a hold on my debt issue. At the time I had about $70K+ in credit debt in good standing (10 accounts in total). When I entered into the program they had me pay just about $500 biweekly into an account to get ready to settle the accounts which would last about 52 months as well as told me to stop paying those accounts so they can be delinquent before they can settle them. Within the first three months of entering they settled 2 accounts (completely paid out). Then in the early part this year they settled 2 more accounts (final payment at the end of September 2018 for each). In August 2018 they came with agreement with two more to start the settlement process (ending date for those is July 2019 to be paid plus these filed court documents not paying recently). Meanwhile still have 4 accounts not settled yet. So this year I did not like my work situation so I started looking for a new job. All jobs that interested me needed to have a clearance associated with it. So I applied and took an offer as of August 2018. At this point I still have about half the money still not settled.

Now that I am going through a secret security process for my new employer. Would I be able to get secret clearance with the mention issues? All of this information (in more detailed is on my SF86 form as well). The other issue I have is speeding tickets. I get about 2 speeding tickets on average a year. Is this an issue as well as? Thank you in advance!!!


Nothing overly alarming stands out. Most of us have some debt and traffic violations. Looks like you are on top of it so I wouldn’t worry. You might have to explain your payment system to an investigator, but shouldn’t be a disqualifier.


That seems like a lot of debt and you haven’t completed the process of cleaning it up. I think that debt settlement is an issue that is looked at closely. I’m not saying that it shows that you don’t play by the rules but I expect that you will get questions about how you let it get so far out of hand and why you think that a portion (my guess is 30-50%) of your debt should be forgiven.

In the end, I expect that you can get a clearance. It’s just going to be a little harder for you than it would be without all of this. They may even hold things up until you have been in the program longer.

Keep making those payments and keep settling accounts. The further you are along, the more it shows you are serious. This way you only have to deal with questions about how you got there.


You used a completely legal solution to solve your debt through consumer credit counseling. This will be looked on very favorably. If you read a lot of the DOHA cases, you’ll see that people with debt issues who got a handle on it and entered into these programs were largely adjudicated favorably. Nothing is guaranteed though I think you are on the right track.


This is perfectly fine. Settlements of debt is a legal remedy for financial issues. If you are settling your debts and not repeating the behavior of taking on additional debts, your just fine.


So I found out today that I was denied my interim clearance. Would the above reason deny my interim clearance even though on my SF86 form I said that I was in a Debt Consolidation program? Any insight would be grateful. Thanks in advance!

The number one cause of security clearance denial or revocation is finance. There were a few Clearance Jobs articles on this topic. Sean Bigley, a clearance attorney, wrote most of those articles. Point being that, clearance applicants or holders need to be wary of advice that they received debt relief group or a debt attorney.

From Government perspective, a debt is a debt. By letting the debt becomes delinquent, it is not a good look by any means. Your plan, in my opinion, will likely not fly with an adjudicator. Those unsettled delinquent debts need to be taken care of immediately.

Traffic citations, generally, don’t amount to a concern. However, multiple traffic citations in short time frame might raise concerns under Personal Conduct. Take these altogether may show the person’s “attitude toward authority and responsibility.”

You might want to read Adjudicative Desk Reference (latest version) and possibly consult a clearance attorney.

I think you will stand a better chance of getting clearance if you are proactively settling or being in good standing with all of your creditors. Make sure you get that in writing. As for the traffic citations, take it easy.

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Two points . . . Despite what you might hear, I don’t believe that interim clearances are being handed out the way that they were in the past. You have to be much cleaner than before and the position has to meet a greater need. Second, your situation doesn’t look like one that would receive an interim anyway. As I noted above, situations like yours are very common and they are looked at very closely.

There are going to be questions and this could take quite a bit of time. Keep to the program and get used to waiting. They are going to give you time to show that you are serious about cleaning up your debt and to show how you are going to avoid getting back into the same situation.


We could advise better if we knew your FICO. If you are sub 600…you are statistically in the group that has difficulty clearing. Not to say you will not clear, but the odds are against you. If you applied with my client and company I would not submit unless you are a 650 minimum, and were in a debt repayment plan with all creditors. That moves debt from unaddressed to addressed. Though nice to know they negotiated settlements and you get away without paying what you charged (nice for you anyway, not the business charged), it reflects as not living up to agreements you made. To be trusted with classified you will sign a secrecy agreement and non disclosure form. It begs the question: will you live up to this agreement? If so what in your life indicates you will do so? I had several employees lose clearances dealing with credit fixing firms. When they went to confront these so called businesses…empty storefronts. And damaged credit. Get into a repayment plan, honor it, and make 5 to 6 payments. This will begin to renew the credit score in your favor. You will still need talk to the settled and charged off debt. So if you owed 10K, they settled for 5K…you need report the 5K. There may be tax implications as well but I am not a financial adviser.

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Are you saying that my situation, even though entered in the debt consolidation program more than a year before this job that required a clearance process, will not be view favorable by an adjudicator? I thought that debt, if being handled are ok. I took matters into my own hand so I can start saving and investing my money for the future. Which I have been able to do. Also, I own an house that I have lived in for more than 3 years. Once I sale this house, which I would be doing once I can start this new job, I would have at least 150K in cash, of which, I would give to my debt consolidation program to handle the debts right away.

I also read that being in a debt consolidation program is looked at favorable. Is this not the case anymore? Thank you in advance for your response!

Since I been in the debt relief program for more than a year now and well before I began to apply to clearance jobs, I thought that I would have been ok. Plus, 6 of the 10 debts in the program have been fully settled by the program. I never needed to be in the program back in Feb 2017. But my debt was not going away and in year and some change my debt is starting to clear up. I have always made good money. I even have a house that with this new job I would sell and make at least 150K on and the first thing I was going to do was give the money to the debt consolidation program to settle these debts right away. But I am at the mercy of the debt consolidation program on how quickly they settle at that moment.

So my FICO score is 588. My Transunion score is 636 and Equifax is 580. So you are also saying that being in a debt consolidation is looked at unfavorable. The consolidation program that I am in have settled 6 of the 10 accounts. 4 of them completed paid out of the settled agreement. 2 of them payments are being made towards them. The last 4 are not yet settled by the program. I have bank statements of me paying $465.50 biweekly since Feb 2016. I also have a house that I will at least make about 150K in sale once I move to this job location. The first thing I would do with this money is give the debt consolidation program the money they need to settle the rest of the accounts. From all that I have read I thought this was a favorable thing for the clearance.

I understand what you are saying about secrecy agreement and non disclosure form. But by me entering this program with the debt I have had I am able to start a saving plan and put money aside for house repairs and other things. I guess my question is that all of this would be not considered favorable as I took matters into my own house to be better financial stability?

Just a guess here, but I wonder if its because you were advised in the last year or so (by the debt relief company) to let your debts go delinquent. So you purposely did not pay your accounts to have them late. Late delinquent debts in the past year probably does not look good. I also wonder about the company you used for debt relief. I believe the better option would have been a non profit debt counseling services. Remember, this is just my guess.

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Most interim clearances are denied these days. Unless your 18 years old with no history. Yes even though your in a DC program. The good news is that the DC program will look favorably when final adjudication is decided.

Now the waitin begins dude.

Dude, the previous poster is not correct. As long as you are showing good faith effort to resolve the debts your good. For example lets say you have 2k charged off and your in a payment arrangement for 25 bucks a month, your good to go. The charged off 2k is treated just like a 2k debt that was not charged off. It’s debts that you ignore that may or may not trip you up.

As part of my PHD project I have interviewed many BI and Clearance attorneys. If your still concerned for 150 buck you can get an hour consultation with a Clearance attorney, provide them the Credit report, and get a plan of attack.

@dude01, what I am saying is that the remaining unaddressed (4, I believe) accounts will likely not sit well with an adjudicator. All of these accounts need to be taken care of immediately.

Let’s say, you have 5 delinquent accounts, and you are paying off 4 out of 5 accounts. You have a plan to take care of the unaddressed account, but you have not done any action yet to date. It is the unaddressed account that can potentially get you a SOR or denial even though you are paying off the four other accounts.

So, you need to get the last four accounts taken care of immediately. Just pay the minimum and you should be good. I believe you need to make at least 3 or 6 payments in order to be considered “good.” That is like 3-6 months hence the advice.

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Nothing here is written in stone . . . Every poster here has said something helpful and provided some false or misleading info.

Yes, financial issues are by far the most common reason for rejections. But, that is misleading. The reason that financial issue lead all others is that far, far, more people have financial than, for example, foreign contact issues. There is a user here, who I like and is VERY knowledgeable, who says that she will not submit a candidate with a credit score below 650. I can tell you that I know people who have cleared or complete a reinvestigation with scores in the very low 500’s.

I can tell you that not every account needs to be currently addressed, but every account needs to be in your plan. I can tell you that Chapter 7 bankruptcy is VERY difficult to qualify for and that you will have a harder time clearing with a Chapter 7.

@AWoodhull . . . If you have four out of five accounts addressed, you are likely get an SOR with all five accounts listed. Not just the one.

Yes, the accounts can be mitigated by working with the creditors to bring your payments up to date but the adjudicator is also going to want mitigating factors for the reasons that you got into trouble in the first place.

There are many, many, ways to skin this cat . . .


Good info here (mostly). I do not submit below a 650 as a general rule, because my client gets more discretion in who they approve. Their stats show 95% clear down to 650 with no other known risk factors. At 630, 37% will not clear, at 600 close to 67% will not clear. In playing the odds I am absolutely confident submitting a 650 all day, a 630 with reasonable explanations and (key info)…“a vigorous, in place repayment plan.” Awood is correct the 4 bills sitting there delinquent is a problem. Easily mitigatable, by repayment plan. Life happens Bills occur. Live up to the obligation and repay if possible. For my client if you have struggles, bankruptcy is the preferred method of dealing with it legally. Merlin is also correct mostly in that any addressing of the issue counts. However, if paying on time did not happen, I would never recommend allowing them to go delinquent on purpose. But I understand the overall strategy, you don’t get the ding of a bankruptcy, your bills are reduced in your favor and against the various merchants who in the end are essentially cheated out of income. A charge off is not unusual and is used frequently. Enough so it is part of overall business strategies that a certain percent will not ever be paid. So far your credit scores are quite good for the circumstances. If you get the other 4 in a repayment plan you get a nice bump in credit score (2 to 3 months.) I can specifically tell you even with a robust credit score near 800…if one has a delinquent account, even if in dispute…it causes problems with my client. I am dealing with this right now for a poly cleared person. They remain in adjudication and have had follow up calls and an interview regarding a charge off from 8 years prior. What this tells me: it isn’t necessarily about the credit score or a bankruptcy, it is the behavior leading to and following both. Behavior is what is being evaluated. I expect this member to clear fully shortly. But as Ed stated you can STILL get an SOR or at the least a conduct letter warning you about standards for your security file. I process about 5 conduct letters monthly. It is considered a formal warning of future intent to monitor. If it is a finance conduct letter, they conduct several credit checks at varying intervals up to 18 months later. If the person slips back into questionable financial behavior, the previous warning puts their clearance at risk. It is interesting to note and Ed captured the reason finances are a big reason, it is also the hardest to deny or revoke from my client. They will bend over backwards to allow you to keep the clearance if you are making a good faith effort. Allowing legit debt to go delinquent, to negotiate a smaller bill does not always equal good faith. If this is apparent based on your income and spending habits…it will be a problem. If it is a legit repayment of what you can afford based on catastrophic loss, death of spouse and lost income etc…it can be a good faith effort. Which leaves us at the favorite answer here, “it depends.”


One question for you, if a candidate has a credit score that is less that 650, however all of the negative information that brought the score down has been paid off, why would your credit score criteria pass muster? For example if a person has a charge off and they paid it off the FICO scoring models do not take that into consideration in bringing the score up. I do not see how a credit score should be a baseline for candidates. Its your companies call and if they want to have this policy then so be it. However, I would pull credit for each person and see if they have mitigated the debts via a lawful means, you may be passing on some great people. JMHO :grinning:

Good question. But it isn’t my company, it is my client. They exercise more control over their clearances. We are a support contract providing 400 grasscutters, housekeeping, escorts, culinary, and other positions normally drawing from a workforce with several other limiting factors in their history. Trust me if I can get them cleared I submit them. This client takes up to 8 months at times to give a Secret, 18 months for TS. We conduct easily 20 to 30 interviews monthly just to break even. Sadly, 75 to 90% are eliminated for recreational use, very low credit scores and sadly functional illiteracy. We only use hardcopy SF86’s so getting them filled out correctly is a challenge.

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