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Short Sales and Security Clearance

Posted by Keith Canty on October 23, 2011 at 9:59am in Short Sale Discussions

I am running into more people with security clearances that need short sales.  The question always arises about the impact of a short sale, DIL or foreclosure on their ability to obtain or retain a secutiry clearance.

Has anyone in the network had any experience with this issue?  Is there a source for information about it?

 

Thanks,

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Replies

  • Sue Irwin November 1, 2011 at 6:06am

    I checked with an attorney who does legal presentations for our local MLS members. Two years ago she had said that one of the reasons short sales were better than foreclosures for homeowners was that foreclosures could affect security clearances.

       When I checked with her yesterday, she had a different take on it -- all having to do with how much of a hit a person's credit score has taken. If they have missed a lot of payments or have other credit dings, a short sale could affect getting a clearance as much as a foreclosure would. The fewer missed payments, the better, in other words.

       I like the discussion about being transparent with HR departments -- makes sense.

  • Jason Boykin October 31, 2011 at 7:44am

    I work for DoD and I have a TS.  I just did a SS and it did not affect it.  I notified my clearance adjudication office in advance and got written assurance that it would not be an issue.

     

    They did say that doing more than one SS would be an issue.


    Jason

    • Keith Canty > Jason Boykin October 31, 2011 at 9:40am

      Thanks, it seems that disclosure is the key.

  • Esther M. Camarotte October 31, 2011 at 4:56am

    State clearance, financial security exchange is different than military/fbi/cia clearance.  I would absolutely follow Nathan's advise and go to your direct supervisor and then to the security clearance office and have it cleared through them in writing. I work the Northern VA/DC/MD markets and this is what I advise the seller.  This is serious stuff and I would never want to be the blame for someone either losing their job or being downgraded because of something I have advised.

    • Keith Canty > Esther M. Camarotte October 31, 2011 at 5:02am

      I agree.  It looks like there is no comprehensive policy.

       

      Thanks,

  • ElizabethWeintraub00697006LyonRE October 30, 2011 at 12:10pm

    I work with many sellers in Sacramento who need security clearance to work for the state of California. Those lovely state furloughs have cost some people their homes. When they call me, they say their lawyers advised them to do a short sale instead of a foreclosure to keep their security clearance. I have not any of these people tell me they lost their security clearance after a short sale, so I would tend to believe that a short sale does not harm a security clearance. Still, I would never guarantee it.

     

    Elizabeth Weintraub

    Broker-Associate #00697006

    Lyon Real Estate

    Lyon Real Estate is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.

    • Keith Canty > ElizabethWeintraub00697006LyonRE October 31, 2011 at 3:59am

      I appreciate the info.

      Thanks

  • 2ay3zdylib37p October 30, 2011 at 9:09am

    I was in the Marine Corps for 14 year. I held a Secret Clearance for 13 of those years. My only advise about clearances is this....full disclosure. Anything and everything that you think might effect your clearance should be discussed with your commanding officer. They are worried about the stuff they can see, they are worried about the stuff they may not be able to see. A short sale based on a PCS Move probably won't affect your clearance. A short sale based on you not paying your mortgage (when the military gives you a housing allowance every month) just might cause a problem.

    • Keith Canty > 2ay3zdylib37p October 31, 2011 at 4:00am

      I will incorporate this in my counseling sessions.

       

      Thanks

  • Alicia Galante October 30, 2011 at 5:12am

    From what I understand, if they are needing a short sale and are having financial issues, they should be reporting to their immediate supervisor and discussing what they plan to do.  They may need to report it then to higher up's within their agency etc...(assuming they are government employees).  It is something they do need to report so it is then on record and perhaps their superior's can direct them as to what else they need to do to properly record their situation to avoid issues with their security clearance.  They must go to the higher up's to get their response as we do not know the effects on their clearance.   That would be the best advice you can give to them...

     

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