We would recommend that you make payment arrangements with the collection agency while officially requesting a review of your situation by the Department of Veterans Affairs. Unfortunately, when it comes to your credit, it doesn’t matter if it was their error or yours. A collection entry on your credit report will haunt you for years, but we’re not sure if it will hurt your ability to maintain your security clearance or not. From what we understand, the government is primarily concerned with large amounts of debt on the books and not administrative issues.