The current unfavorable economic climate has created serious credit problems for millions of consumers. Below you will find some helpful tips to improve your credit, no matter the severity of the situation.

The first thing you want to do is look at your credit report and learn your credit score. There are a lot of websites out there that offer credit reports, some even for free. When you know what your credit report says, you are better prepared to fix the problem.

Keep in contact with creditors in order to work out a payment plan for your debts. You can avoid penalties and interest by making a plan and sticking to it. Try to pay things off one at a time.

Meticulously document any negative information that you find on your credit report. If you happen upon any items that are being reported incorrectly, contact the creditor that is making the erroneous report to ask them to fix the error. In addition, you can also file a dispute with the credit bureau. For correct negative information you should include an explanation so any creditor in the future can see that information.

Know your rights when it comes to debt collection. You will not be thrown in jail for your debt, and any collection agency that uses threats against you is breaking the law. No state has the same laws on the books, but most offer protection against creditor harassment. Make sure you know your rights, and the collection agencies won't be able to bully or manipulate you.

Be sure to keep your credit card's balance at 30 percent or under at all times. Staying at or below 30 percent will make your payments manageable. If your credit card balances go over 30 percent, your higher monthly payments might negatively impact your ability to pay other bills.

Develop a payment plan for bills that have been turned over to collection agencies. The vast majority of collectors want to work with you. Ignoring calls is never the answer-- they will just keep calling more frequently. They are going to help you out if you try to work with them. Sometimes, they'll even take a smaller sum. Dividing up your bill is a good option.

By looking over this information, you can begin repairing your credit today. Following these simple suggestions will bounce you back to a great credit score.