Most of the myths are harmless fun; but when it comes to your credit, you could lose money and break the law if you don't know the truth.

Some credit repair companies make promises about turning bad credit into good credit. And while it may sound enticing, don't be fooled. Truth is, nobody can legally remove accurate and timely information from your credit report. You should be skeptical of any company that claims they can do a quick fix to your credit.

In fact, the Federal Trade Commission (FTC) is continuing its crack down on credit repair schemes. Eileen Harrington, Deputy Director of the FTC's Bureau of Consumer Protection, is part of the project. "There is absolutely no reason to pay for credit repair," Harrington said. "Despite their claims, there is nothing that any credit repair firm can do for you for a fee that you cannot do for yourself at little or no cost."

So, what can you do if you want to improve your credit? Here are some suggestions: Identify harmful habits Order your credit report and look for any problem areas that jump out at you. If you see that you have a bunch of late payments, what can you do to make sure you pay on time? Or, if you notice that you have credit card balances close to your limit, you should try to pay those balances down first. And, do you have several hard inquiries on your report? This could mean you're applying for too many credit cards.

Set measurable goals-Once you decide you want to tidy up your credit and know what you have to change, it's a good idea to set goals. That way, you can track your improvement. Plus, when you reach a goal, you'll have reason to celebrate.

One of your goals might be to improve your credit score by 50 points—or get your score above 650. In general, a score of 650 or higher will help you qualify for better interest rates on loans. You can see how you're progressing by checking your score every three months or so.

Be realistic - Let's face it, our dream house and what we can actually afford are usually two different things. When you're applying for a mortgage or any big loan, it's important to be honest with the lender about your current financial standing. Otherwise, you may take on a mortgage that's too much to handle, and you could overextend yourself.

The biggest thing you need to improve your credit health is the right attitude. If you believe you can do it, then you will do it. And remember, credit mistakes aren't set in stone—negative records will expire from your credit report. With time and a little effort, you can fix those mistakes.