Delinquent debt and my reinvestigation

I currently hold a TS clearance and have been through one reinvestigation already. My next reinvestigation is due in about a year, I believe.

We bought a new home in Oct of last year and decided to keep our townhome as an income property. The townhome is under water (i.e. worth less than we owe), so on the suggestion of our Wells Fargo mortgage broker for our new home, and based on information I’ve found here: we stopped paying the 2nd mortgage on the income property just after we closed on our new house in an attempt to leverage our 2nd mortgage holder to settle the account for less than the full amount owed.

The mortgage on our new home is spotless. The primary mortgage on the income property is 100% good, never any late payemnts. We have absolutely no other delinquent debt, but as we get further down the road with the 2nd mortgage, and I get closer to my next reinvestigation, I’m worrying more and more that this will prevent my TS renewal from going through.

Looking forward to any thoughts the experts here might have.

There are two issues with your scenario:

  • have you reported this delinquent mortgage to your security officer? As a TS clearance holder it is something that should be reported immediately.

  • what have or are you doing to resolve the delinquent debt, if anything?

These are the questions you will face when your periodic reinvestigation comes around and the more mitigation you have before then the less concern the issue will be.

Thanks for posting, Marko.

I will notify my security officer on Monday.

We currently haven’t paid the 2nd mortgage for 9 months. This isn’t an INABILITY to pay - we have the money to bring the account current right now, this was a choice not to pay as a way to motivate the lien holder to settle the account for an amount less than full.

Obviously, if this is going to cause issues for my security clearance, it’s not worth the money we would save. Hence, my question here.


So, to sum up - I currently have about $8K of delinquent debt from a 2nd-mortgage on a rental property that we chose to stop paying.

The desired remediation outcome is that the 2nd lien holder settles the account for less than the full amount of the loan, however there is a STRONG possibility that this will not happen prior to my TS reinvestigation.

If I have no history of financial credit problems, this is the only account that has ever been more than 60 days delinquent in my credit history, and all of my other current credit lines (credit cards, car loans, mortgage on our primary residence, 1st mortgage on the rental property, etc) are all current and have never been delinquent - will this one account being delinquent with no real remediation happening - keep me from getting approved on my reinvestigation?

I currently have enough money to bring the account back to current without setting up any sort of payment plan, but if I let this go another couple of months, I might not. So, if this is definitely going to kill my clearance, I’ll just get it taken care of now.

I think I’ll submit this as one of the paid questions, as well.


One account for $8K should not prevent you from getting cleared, however, you will have to explain what you are doing and why, and may have to provide documentation as a follow-up later on down the road to prove that it is going to eventually be resolved.

Thanks again, Marko, for weighing in. I did submit a paid question on this topic, as well.

The amount is currently $8K, but it increases by $700 each month (plus fees). Does the amount make much of a difference? The only number I’ve ever seen referenced in any of these articles is $3500.

There is no hard or fast rule on amounts as payment plans can vary in order to resolve a debt. Generally if your salary vs. debt ratio is skewed towards delinquent debt then it becomes an issue.

Honestly I think the REASON for the delinquent debt could raise an huge issue. It is a conscience decision to stop paying on the debt borrowed, agreed to and owed, not because of an inability to pay but due to a hope that they will be offered a lessor amount to repay by the creditor. I would think that would be a big problem personally but I am not an adjudicator.

I’ve looked at it from both sides of the coin on that, Contractor. I agree with you that I worry the fact that we have chosen not to pay could raise concerns. However, if the worry is that the unpaid debt could be used as leverage against me, that goes out the window because it’s a debt that I’m already choosing not to pay.

This is why I opened a question under the “for pay” service here. I’m completely confused and worried.

Im in the Air Force and got an assignment where I need a TS clearance. In the past 7 years I have had more than one Delinquent account that went to a collection agency. when contacted by the debt collectors, I set up a plan to pay it in full. All my accounts that were delinquent are paid in full and my credit score is 700 now and my total debt is only around $2000. Do you think I will be turned down because of my past?

Thank You.

Good day,

I am new to all of this and am applying with TSA for a TSO position. I have a charge of on a loan for a car in which I am in dispute with the lender. The charge off amount is $7,556 and TSA policy is $7,500 maximum delinquent debt on credit report. I would believe in my situation that would make me ineligible. Am I correct in this belief and if so, if I accept the lender’s pay off settlement payment plan would that be enough to show that I am taking care of the situation? If not would filing for BK be viable? Any information is much appreciated!

Thanks in advance,


Because you have taken steps to resolve your delinquent debts you have taken responsibility for your just debts. You did not indicate why they when into delinquency in the first place, but as long as the reason no longer exists then you should not have a problem getting the clearance.

Regarding TSA’s debt limits, I cannot say how they would view it, but they would take into consideration the circumstances of why you incurred the debt, and what you are doing to resolve it before making any decisions. I would not advise bankruptcy for such a small amount, just because it is a legal means of getting rid of debt does not mean it is they best option.

Thanks for the information Marko.