How Debt And Credit Score Affect Security Clearances

Updated: December 22, 2023 Author:

Quick answer: If you work in an industry where you will come into contact with sensitive information then a security clearance will typically be needed. Having debt like a mortgage or credit card will not typically affect your ability to get cleared, but a low credit score often will. Low credit scores are an indicator that you could be in financial difficulty and liable to be targeted by a third party looking to gain unauthorised access.

    What is a security clearance?

    A security clearance comprises a detailed series of background checks that cover everything from your education and financial situation, to your circle of friends and other connections. The point is that as someone working with sensitive or classified information on behalf of the UK government, your trustworthiness needs to be thoroughly checked. This will ensure you can work with, access, and produce classified documents and data without being liable to falling victim to exploitation. 

    How do debts affect the security clearance process?

    Debt is a part of life in that it allows you to acquire assets without having to save up all of the capital in advance. When debt is well-managed and consistently repaid over time, there will typically be no impact on your ability to gain a security clearance in the UK. Here’s how you can make sure that this remains the case during and after the clearance review process: 

    • Set up direct debits so your monthly repayments automatically leave your bank account at the same time each month 
    • Create a household budget that allows you to see where your money is going so you can make an informed decision on future loans and credit cards 
    • Take an active approach to managing your finances so that you can create a plan to gradually and consistently improve them over time 

    While debt will not typically stop you being able to become security cleared, every aspect of your household and personal finances will be reviewed. The more you can keep track and control your levels of debt, the less likely your finances are to cause an issue with your clearance. Many security clearances will be subject to periodic review, making a proactive approach particularly important. 

    How does your credit score affect the security clearance process?

    Credit scores are more likely to influence the security clearance process than personal debt. At time of writing, negative financial situations are one of the primary causes for security clearance applications being turned down and denied. While this may seem arbitrary given the fact that well-managed debt typically has little impact, the reasons make sense upon closer inspection. 

    Security clearance is there as a backstop to reduce the likelihood of official secrets and sensitive information falling into the hands of malicious third parties and nation states. Information that is leaked by bad actors can cause damage to the UK government in a variety of ways, with third parties typically looking for weak links and easy access points. 

    If a government official is in financial difficulty, or has a track record of consistently missing repayments, it is a marker that they are more susceptible to exploitation. A low credit score indicates that an official may be targeted with bribes and other forms of incentive in exchange for unauthorised access. 

    Why is there more of a focus on credit scores than debt?

    The simplest way to think of this is that debt is the money you owe, while your credit score is a measure of how well you have managed your debt over time. There is nothing negative about debt in and of itself; it’s how the debt is managed with timely repayments and proportionate borrowing that really matters. 

    Here are some examples of how a low credit could increase the risk level of a security clearance applicant: 

    • A low credit score is an indication that the applicant has a history of financial issues and difficulties which could make them more amenable to a bribe 
    • Low credit scores are often linked to higher levels of stress, lower levels of career satisfaction and restricted borrowing opportunities. All of these can cause financial difficulties which can result in targeting 
    • Third parties will be able to search credit scores and financial histories, allowing them to purposefully target those who they feel are the weak links 

    Passing a credit score threshold is not merely a bureaucratic exercise — it is a statistical measure of an applicant’s susceptibility to exploitation. 

    Will a low credit score impact my career progression? 

    If you work in an industry where UK government clearance is necessary for access to roles with higher levels of oversight and responsibility, a low credit score may impact your progression. While a low credit score is no reflection of your job-specific skills, nor your personal integrity, it can lead to denial of security clearance for the reasons mentioned in the previous section. 

    If, for example, you have a default on your credit profile, you may find that this results in security clearance being denied for the 6-year period it is listed. While this is something no one wants to hear, knowing the basics will allow you to make an informed decision about your future career. Actively taking steps to improve your credit score can help you in this.  

    What steps can I take to improve my credit score? 

    You can increase your credit score by being proactive and strategic with how you organise your personal finances:

    • Try to exceed the minimum repayments on loans and credit cards wherever possible so that you pay off your debt quicker 
    • Resist making multiple applications for credit in a short period of time, particularly if they require you to pass a ‘hard’ background check 
    • Speak to lenders at the earliest opportunity if you anticipate having problems meeting your agreed repayments 

    Being proactive with your personal finances will allow you to gradually improve your position, raising your credit score as a result. While there is rarely a quick fix, it will make a difference as you achieve progress step by step.