Will Bad Credit Kill My Dream?

[SHAWAM]

Here's my situation, and I ask that anyone who replies be courteous enough not to rub salt in my wounds: this is already stressful enough.

After 2 failed attempts at the ASTB, I finally got a 43...I know, it's not impressive in the least. However, my recruiter told me that my GPA (3.4) and my prior service should off-set that, especially as I was only applying for SWO (supply). I'm 5'11, 197 (just 1 lb over) and have yet to take my PFT or go to MEPS. However, the biggest hurdle for me is my debt...to the tune of $14,000 on one charged off account, and $3,000 on another.

I know that's bad...I know that's VERY bad, but though it makes me look like I was an irresponsible fool who bought everything in sight on credit and then couldn't pony up the money, that's not how it happened. The vast majority of that debt came from paying for college. Yes, I had the G.I. Bill, but it wasn't enough as tuition and everything went up each semester. I qualified for scholarships, but because of the G.I. Bill, I couldn't get them. I even attempted to settle my debts before. Lets just say I fell prey to a scamming debt consolidation company that stole my money and did nothing to help my credit. I have those records.

I'm on the verge of settling the smaller of the 2 debts. I know my chances are still next to none, but my recruiter suggested that maybe with the proof of past attempts to correct my debt and with me settling at least one of the two debts before my packet going in, that the review board might let me in if I submit a letter explaining all this and my plan to finish clearing my debt. The remaining debt could be paid off in no time before I had to go to OCS. The problem is, in order to pay off the debt that fast, I'd need the income from the BDCP...yet the debt is probably what's going to ruin my chances of the BDCP. What course of action should I take? If I don't get in via BDCP, what other options for a commision are there with my current situation? A commission in the Navy has been my dream for a while now. Also, even though my packet hasn't been sent in yet, I recently received a letter from the Naval Review board in Raleigh, NC declining my application...how is that possible?

Just for more clarification for those that would logically say "Well if you got a letter declining your application, then obviously your packet was already sent in." I still needed quite a few things before my packet was complete: fingerprints, past employer references, a newer copy of my transcripts, and copies of my original SAT scores (that I took waaaaay back in 97). That's why this letter from the Navy Recruiting District has me confused and on the verge of an emmotional breakdown. Perhaps the EPSQ (the electronic part of the application) is what this is all about, in which case without my supplemental letter about my debt, I can understand the decline for a recommendation.

 

[thenuge]

The first thing that I would say is, relax. You can tell that you are trying too much too soon. I do this too. Take deep breath.

Now, go get a job or two and start paying down the debt by sending the creditors money like your life depends on it. You were a Marine. Use some discipline and make it happen. Move in with mom and dad or whatever so you have no bills. Do not go out partying blowing all your cheddar. You may want to take a loan out from the bank to pay the credit cards off, and then pay off the bank. Don't just say "I need to get into BDCP so I can pay this debt off". That sounds crazy to me.

If I saw correctly on your profile, you are only 25 and prior service. You have plenty of time to get sh!t done. Just take your time. Did you rush to take the ASTB? Sounds like it. I did see a couple posts on here from guys that scored similar to you that are now aviators in the navy and had like a 3/4/3. You can't take the test anymore so that's one thing you don't have to worry about. Just pay that debt down, work on good LOR's, and beef up other areas of your package. After you get the best possible package, submit it to every board untill you are no longer eligable.

When you try to do everything at once you don't do anything well. I have had to train myself as well.

 

[pdx]

The most important issue about debt is whether or not you a security risk because you are A) irresponsible, or B) a blackmail risk. It is not necessary to pay off all your debt to pass a security check. Just do what you can to take care of it and disclose EVERYTHING. Then work on the more important aspects of your application.

As I understand it, the financial stuff only affects your security clearance, it is not a competitive criteria for selection. The Navy asks because they want to be reasonably sure that you can pass the security check when the time comes for it.

I do have some personal experience with this stuff, so PM me if you have a specific question.

 

[thenuge]

If most of the debt is from college that should not be an issue. I have $8,000that I have to pay off. I think what they are worried about is if you have had any cases turned over to a collection agency.

 

[SHAWAM]

They have both been turned over to collection agencies. The smaller of the two for $3,000 is about to be settled in a month or so for, at the most, $2,200. That still leaves the $14,000 debt, and those guys aren't budging for anything. I probably am trying to do way too much, too fast...I took all three of my ASTB's as soon as I could, I've been running around like a chicken with my head cut of trying to get everything done. If I don't get in before the board closes this year, then I'll have to wait till next June, and by then I'll have graduated and my chances of paying that larger debt down will be small. Is a direct commission as hard to get as BDCP?

As for the security clearance, when I was a Marine I had a Secret clearance since I was in communications and worked with cryptology...would that matter any? Moreso, doesn't it take up to 3 months before paid off debt shows on your credit report? And what about that mysterious letter from Raleigh's review board declining the application that I didn't even send in?
And as far as my LORs go...well, two are from professors and one is from a current Navy Ensign. I thought that last one was good, until I found out he was a reservist (absolutely no disrespect to reservists intended). Someone told me that unless it was a high ranking, fully active or retired officer, that my LOR from that Ensign meant next to nothing...is that true?

 

[Ajaxus]

One name: Oprah

Don't shoot the messenger yet. She recently finished a mini-series on money saving tips for pulling people out of debt. Now I'm not an oprah fan but when your best friend's mother is always watching, you tend to pick stuff up.

Go to her website and there should be some tips on there about how to better manage your money as well as ways that you can get 0% interest on your cards and make it easier to pay them off.

I guess it caught my eye because for awhile I too was in debt, but now I'm out of it and happily saving up some good money.

 

[SHAWAM]

Thanks to all who replied. Unfortunately, I just got off the phone with my recruiter about that letter of rejection I received even though my packet hadn't been sent in yet. Apparently, it's not the fact that I have debt, but the fact that the debt is in default. According to him, I can't get a security clearance for at least 3 years, even if I were to pay off all the debt this very day. So there goes my dream. Mediocrity and a lifetime of living pay check to pay check, here I come.

 

[fly2fight25]

Personally, I think this is bullsh**! Just because a person has bad credit doesnt mean they're gonna go out and run their mouth about classified information. I mean seriously, how the hell can they honestly judge a persons over-all moral character and loyalty to this country by examining a stupid credit report. Especially a man who has already served his country and proven himself in the U.S Military. People get up to their ears in debt every single day. Does that mean we need to lock them all away out of fear they might commit treason. All it means is that the individual was irresponsible with his spending and in no way says he is irresponsible in all other aspects of his life. You can have a stellar background, 4.0 GPA, 9/9/9 80 ASTB, and in perfect health... but the credit report can stop you from becommin an aviator?....thats flat out BULLSH**!!

 

[fly2fight25]

I know this sucks brother.. But before you give up on your dream, I have a few questions. 1- How old are you? 2-Does anyone know at what point in flight training do you go for your SEC clearance? 3-does the 3yr wait time to get a clearance start from the time the debts are paid off?

 

[Brett327]

Personally, I think this is bullsh**! Just because a person has bad credit doesnt mean they're gonna go out and run their mouth about classified information. I mean seriously, how the hell can they honestly judge a persons over-all moral character and loyalty to this country by examining a stupid credit report.

Well, let me be the first to correct your clearly misguided opinion of how things are done. Having had bad credit isn't just about being irresponsible. While it is true that a failure to repay one's debts does not necessarily mean that a person will be lacking in other areas, it is a pretty good indicator of a person's character. Why should the government take that risk when there are plenty of other applicants who have made appropriate choices in their lives? Second, the main risk in having debt in default is that the debtor is vulnerable to exploitation to espionage through financial incentives. If you examine the history of Americans who have spied against this country, the vast majority have done so not for ideological reasons, but for financial gain - many of whom had accumulated sizable debts and saw espionage as an easy way out. The government has to make policy based on broad generalizations of how large groups of people generally behave under certain conditions. Do you now understand why the government has a responsibility to make those kinds of choices?

Brett

 

[fly2fight25]

I understand their motives. However, my question here is, do they just look at the credit report and throw up the "DIRT BAG" flag? Or do they look at what the applicant has done or is doing to show that he has taken responsibility for his actions and is correcting his mistakes?

 

[KSUFLY]

I understand their motives. However, my question here is, do they just look at the credit report and throw up the "DIRT BAG" flag? Or do they look at what the applicant has done or is doing to show that he has taken responsibility for his actions and is correcting his mistakes?

Defaulting on a loan is poor judgement of character, period. And of course they look at what the applicant is doing to correct their mistake, after three years time.

 

[Brett327]

I understand their motives. However, my question here is, do they just look at the credit report and throw up the "DIRT BAG" flag? Or do they look at what the applicant has done or is doing to show that he has taken responsibility for his actions and is correcting his mistakes?

It's not a matter of being a dirtbag or not. It really has less to do with your credit report and everything to do with debt in default. The time to take responsibility for one's actions is before your debts go to collections. The government deems that an unacceptable risk. As previously posted by others, after having demonstrated a responsible financial track record for a few years, that individual can then be reevaluated. Per your other questions, one can't qualify for a commission without being eligible for a secret clearance, so your idea of waiting it out while in a training pipeline is a non-starter.

Let this be a lesson to all: Your life choices have consequences, so choose wisely.

Brett

 

[fly2fight25]

Ok well that answers that. I guess im just trying to get an idea of where he stands as far as how much time he has until he becomes ineligible due to age. If he's 25 with prior service (depending on how long he was in) he may have enough time to get his sh** together and let 3 years laps before applying.

 

[greysword]

This may be exactly what you need, Sawam.

First, I'm not sure what your financial situation is at the moment (job, total debt, etc), but if you can hold off on getting the settlement and instead obtain a consolidation loan, it will look better on your credit report. If not, see if you can set up a structured payment plan with the collection agency. If these are not available, then go with the charge-off.

As for getting in, I would like to suggest you let this board go. Instead, look at the time you have as an opportunity to get yourself ready for the next one.

To get ready, I would like to put forth the following ideas:

- Join the Navy Reserve: If you have three years available before this clears your credit, then use that time to earn a little extra money and build up credibility, which you can cash in for LORs later. You would have the opportunity to get several personal awesome LORs from high ranking pilots and NFOs that would help with the board. You may also get a bonus to help with the debt by enlisting as well as the Reserve GI Bill.

- Restablish your good credit: having several years of spot free credit can go a long way in a statement, because you could then chalk it up to youthful indiscression.

- Earn a Masters degree: If you have the three years and the drive, take out some student loans (instead of using credit cards for college expenses) and get a degree that would look great to the board. You may even be able to get another bachelors if you wanted. This would give you LORs from professors as well, who can speak to your advanced studies ability.

- Develop the whole person concept: You can use the time to also volunteer, play local league sports, and other things to make your application more impressive.

All of these things are designed for you to focus on getting accepted as a pilot, NFO, or whtever. keep the Navy in the forefront of your mind at understand that these things are a means to an end, and you will need to excel at each. After a year or three, you can walk into the recruiter's office confident that you will be selected.

Basically, don't rush too fast or you may miss something important.