There are ads all over the place, online and offline that tell you to contact this number for free information about credit repair. People who have bad credit are, unfortunately, usually in a very bad situation and fall for this. You need to realize that unless you are extremely busy, there is virtually nothing that a credit repair company can do that you cannot do for yourself. All it takes is some research to find out exactly what you need to do, and then all it will cost you is some time to make some phone calls and mail some letters.

No, I am not talking about some kind of envelope stuffing scam, but I am talking about writing a nice coherent letter to your creditors and the credit bureaus. Contrary to popular belief, the collections department personnel of your creditors probably does not consist of guys the size of football players with a temperament to match. Generally speaking, they are understanding people, to a limit. You need to find out what that limit is, and if you are going through some tough financial times, you need to explain that.

Why explain your sorrows so them? Because above all, nothing makes the collections people angrier and want to take further action on your account than your silence. You cannot avoid their phone calls forever, and you cannot ignore their threatening letters forever. Call them, talk to them, follow up that conversation with a letter to them that says "Per our discussion on (date), I wanted to confirm the following understanding that we reached concerning my account" and then elaborate on that understanding that was a result of your discussion.

You also need to know your rights under the law, which is among other things the FCRA which is the Fair Credit Reporting Act. There are things that creditors can do, and if your account is significantly delinquent and you are not maintaining contact with the creditor, they will probably use every tool at their disposal. But there are certain things they cannot do by law, and you need to be aware of what those things are, and call them on it if they use that technique. For example, a creditor cannot contact you at your place of employment if you specifically tell them not to. I recommend that you put this statement in writing and send it to them, since if you just tell them, they can always deny it. Since a call to your employer can put your job in jeopardy, this is not allowed if you ask them not to.

But keep in mind that your creditor is likely to be more than willing to work with you to work something out if you keep in contact with them. They fully understand that the alternative is that you could file for bankruptcy, and in that case, they will very likely get pennies on the dollar for the amount that you owe them. While bankruptcy is not an option that you should consider lightly, it is an option if you are in way over your head. For more information about bankruptcy and your options, please visit Bankruptcy Advice.

But the biggest thing you need to know is that there are things you can do to fix your situation yourself, which includes keeping your credit report as clean as possible while you get your financial act together. Your credit report almost certainly contains errors, and there is no sense in having inaccurate bad information on there. That is another thing that a credit repair agency will do for you that you can easily do yourself, as long as you understand the rules of the game and are willing to invest in some stamps, which I guarantee is going to be much cheaper than hiring a credit repair agency.

Understand the law and understand your rights under the law. While you may be in a bad financial situation, there is no sense in allowing it to be worse than it needs to be while you get yourself put back together.