Mixed in with legitimate credit repair services are a great number of credit repair scams out there. These scams often promise to fix your bad credit overnight. In reality, many of these so-called 'experts' will either overcharge you, involve you in illegal activity, or actually put you in a worse financial situation. Here are 5 of the most common scams.

If you are in a serious credit crisis right now, get a friend or relative to help you find a legitimate service because you are likely not in a good emotional state to make an informed choice with a clear head.

1. You may run across fix credit sales people who will tell you to manipulate loan applications or suggest that you create a new identity. Not only is this against the law, it's downright immoral. If anyone suggests that you open accounts in a new name or falsify your information on credit applications, get away from them as fast as you can.

You can be charged with fraud for it and held responsible for your actions, even if you were acting on the company's advice. You certainly don't want to add legal problems to your credit woes. Remember: 'Ignorance of the law is no excuse!'

2. Watch out for credit repair companies that charge you for credit repair steps that you could do for free yourself such as come up with a budget. Don't do business with a company that asks for money up front without telling you fully what they will do for you. And, read the fine print for hidden fees.

3. The 'Escrow Account' scam is especially dangerous. These fix credit companies will promise to pay your creditors from money you pay to them, which they keep in an escrow account.

Why is this a huge problem?

The debtor, that's you, gives money to the credit repair company, presumably for paying off debts. The company places the money in an escrow account where it supposedly accumulates. The idea is that the company will eventually pay on your debts when the amount reached in the account matches the payment required by the lender.

What is hidden is this: The credit repair company will be systematically removing some money from the account for administrative fees while creditors are put on hold.. In the meantime, creditors are increasing their interest charges on what you owe until finally starting legal action against you. As you can see, this type of scam can actually damage your credit rating even further!

4. You may also talk with credit repair representatives that pressure you and want you to sign a contract you have not read. Such tactics should make you suspicious and should be rejected. When they put the heat on, say: 'I would like to have my attorney read the contract first." Then, see how they react. A legitimate fix credit service will never have a problem with your request.

5. Many of the advertisements are by companies that offer you fast or instant credit repair, no matter how bad your credit history is. This is simply a misleading claim that no company can possibly deliver on. Be honest with yourself. If you have very bad credit, you know it may take months, even years, to fully repair.

They may try to sell this by claiming that they can remove negative items from your credit history by disputing them. This is a half-truth. They simply cannot remove true and accurate information from your credit report. While it is true that a credit bureau must investigate a claim of inaccurate information within thirty days, this does not mean that the company will automatically remove the information. So, if the information is accurate, it remains and there isn't a thing anyone can do to remove it.

Don't kid yourself. The major credit bureaus are wise to this scam and have become very good at detecting it.

They sell the scheme like this: They claim that by disputing every negative item on a credit report, the backlog of your disputes will cause the credit bureau to automatically remove the offending items from the report because, remember, the credit bureau is bound by law to remove disputed items it has not investigated within 30 days. This technique is a scam and makes you dishonest since you are not just making claims of inaccurate information, you will be disputing anything negative, whether true or not.

Frankly, this technique is borderline illegal so get away from these guys quickly.

So, what is the best solution for fixing your credit?

My answer is: There is wisdom in a multitude of counselors! Assemble the information you need to know to help yourself fix your credit history.

A good team of counselors can help you get your credit score back in shape. The most important member of that team is yourself. You are the one with the financial problems and only you know what you can or cannot do to fix them. This makes you the best advocate in the credit repair process.

Before you listen to strangers who want to sell you their services, get educated about credit. You may want to check with your local library for financial help books, go on-line and check government websites for free information, ask friends or relatives who have good credit, and check with local non-profit organizations to advise you.

Once you get good advice and more knowledge, fixing your credit history and raising your credit score will be easier than you imagine.