Free annual credit reports are now available in every state. To order your free report, go to www.annualcreditreport.com, and either order your report online or download a form to mail in your request. You can also call 877-322-8228.

Also, you are entitled to one free copy of your credit report each year under the following circumstances:

• you've been denied credit because of information in your credit report and you request a copy within 60 days of being denied credit
• you're unemployed and looking for work
• you receive public assistance
• you believe your file contains errors due to fraud or you are (or you think you are) a victim of identity theft
• you've been denied employment (or another adverse employment decision has been made) based in whole or in part on information contained in the report, or
• your report has been revised based upon an investigation you requested.

Credit reports are compiled by credit bureaus -- private, for-profit companies that gather information about your credit history and sell it to any number of businesses that are allowed to see your credit report: banks, mortgage lenders, credit unions, credit card companies, department stores, insurance companies, landlords, and employers.

Credit bureaus get most of their data from creditors. They also search court records for lawsuits, judgments, and bankruptcy filings. And they go through county records to find recorded liens (legal claims).

Credit reports include noncredit data such as names you previously went by, past and present addresses, Social Security number, employment history, and even marriages and divorces. Credit data includes the names of your creditors, type and number of each account, when each account was opened, your payment history, your credit limit or the original amount of a loan, and your current balance. The report will show if an account has been turned over to a collection agency or is in dispute.

Once you succeed in getting a credit card, you might be hungry to apply for many more cards. Not so fast. Having too much credit may have contributed to your debt problems in the first place. Ideally, you should carry one or two bank credit cards, maybe one department store card, and one gasoline card. Creditors want to see that you can handle more than one credit account at a time. But use all of the cards only if you can pay the charges in full each month. You don't need to build up interest charges on these cards.

Creditors may frown on applicants who have a lot of open credit. So keeping many cards may mean that you'll be turned down for other credit -- perhaps credit you really need. And if your credit applications are turned down, your file will contain inquiries from the companies that rejected you. Your credit file will look like you were desperately trying to get credit, something creditors never like to see.

As you read through your credit report, make a list of everything that's incorrect or out of date. Then complete the "request for reinvestigation" form that the credit bureau sent you, or send a letter listing each incorrect or out-of-date item and explain exactly what is wrong. Once the credit bureau receives your request, it must investigate the items you dispute and contact you within 30 days. If you let the bureau know that you're trying to obtain a mortgage or car loan, it can often do a rush investigation.

Examples of incorrect information are:

• incorrect or incomplete name, address, phone number, Social Security number, or employment information
• bankruptcies not identified by their specific chapter number
• accounts that are not yours or lawsuits in which you were not involved
• incorrect account histories, such as a history of late payments when you paid on time
• any closed accounts that are listed as open -- it may look as if you have too much open credit, and
• any account you closed that doesn't say "closed by consumer."

If you are right that the information is inaccurate or incomplete, or if the creditor who provided the information can no longer verify it, the credit bureau must remove the information from your report or modify it based on the results of the investigation.

Most negative information can stay on your credit report for seven years. Lawsuits, judgments, paid tax liens, accounts sent to collection, criminal records (except criminal convictions, which may be reported indefinitely), late payments, and any other adverse information can normally stay on your credit report for seven years. Overdue child support can also stay on your report for seven years.

Note that some adverse information regarding U.S. government insured or guaranteed student loans, or national direct student loans, may be reported for more than seven years.

Bankruptcies, however, can normally stay on your credit report for ten years from the date of the last activity (usually the date you received your discharge, or the date the case was dismissed, although credit bureaus sometimes start counting from the earlier date of filing).

Credit inquiries (requests by companies for a copy of your report) can stay on your credit report for only two years.

1. Pay off any old, collection account or delinquent debt.
2. Only open and keep accounts that you need... don't race to put 20 credit cards in your pocket.
3. Don't apply for every credit card that comes in the mail or via email. The more "HARD INQUIRIES" on your report the lower your score.
4. Pay off credit cards and other revolving lines of credit every month if possible.
5. Always pay EVERY bill on time, even if it means sending in less (but at least the minimum amount). If you can't pay your bill on time, call the company and let them know.
6. Read carefully any application for credit, considering the APR, late and other fees, annual or monthly fees, and Grace period (if applicable).
7. Shop around for the best credit possible.
8. Run a credit check on your own credit profile and dispute all incorect information.