The credit repair business is booming due to the poor economy. Repairing damaged credit can be a pain, but we can help you make it as easy as possible.

To improve or repair your credit, you must first obtain a credit report and credit score. You can go online to locate free credit resources and reports at several different websites. You can't fix your credit if you don't know what shape it's in now.

Determine which creditors are open to offering you an installment plan or postponing your payments. When you know which creditors won't accept delayed payments or installment plans, you can move forward and focus on those particular bills first. You need to know how much you are being charged in penalties and interest. You should start by paying the debts with the higher interest rates to save money.

Look for the negative items included in 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. Write down anything that may be your fault and try to fix them.

You must be aware of your individual rights as a debtor. Debt collectors are not legally allowed to verbally harass you over the phone. Keep in mind that no one can send you to prison for not paying your bill. Check the laws in your state as each state makes their own laws. Let the collection agencies know that you want to communicate with them only through writing.

You should try to limit your credit card usage, and not use more than 30 percent of your available credit. Doing so will help keep your credit card payments at a realistic level. Anything over 30 percent will lead to negative financial issues.

If you have debts which have been sent to a collection agency, do your best to work with them. If you stay in communication with the collection agencies, they are more willing to help you and perhaps offer a payment plan. Ignoring them is counterproductive, since your debts will not disappear on their own. There are some agencies that will allow you to cut your debt in half, if you are financially strapped. If you receive notice that your debts have been bought by a collection agency, you should express willingness to cooperate with them. Most agencies are happy to work with you to determine a plan to pay down debt. Whatever you do, you must confront your problem head on. Do not try to avoid the problem, because your debt will not go away. There are collection companies that will reduce your debt in order for you to have easier monthly payments.

The tips you just read are essential to maintaining good credit. These are steps that you can take on your own to begin the process of improving your credit right away.