Many people find their selves way over their heads in debt these days. Between credit cards, house payments and paying car payments the interest on these things can really add up.

There are a few different ways to get out of debt and repair your credit at the same time.
Without having to file the dreaded final alternative, called "bankruptcy".

One-way is to go with a debt consolidator. This is where you higher someone from a company to talk to your creditors and make your payments for you. The draw back in that is, you have to turn over your paycheck to the consolidator and then they pay on your debts, then they will send you a check for the difference. Basically, you get an allowance from your paycheck from them. If you are one that cannot budget, or talk to your creditors, for whatever reason, this could be a good way to go for you.

However, if your not afraid of talking to your creditors and negotiating a payment plan that you and the creditor can live with, here are some things you can do.

First off, you need to sit down with all of your bills. Sort through them and decide which ones are the most important to pay first, such as house payment, car payment, groceries, utilities and insurance. Place them all in one pile or file them by themselves. Then place credit cards and extra expense items that you pay for in another pile.

If you bring home 2500 dollars every two weeks, that means you bring home 5000 dollars a month. Take your paper, pen and calculator and place that amount at the top of your page. This will start you on creating a budget. Then add up your payments that are necessary to pay each month. Subtract the total of your must haves from your total monthly take home pay. Let's say, as an example that your must haves, added up to 3500 dollars, don't forget to figure in gas to get to work, groceries for the month and your minimum utility bills, phone and insurance. This will leave you 1500 dollars to pay off your credit cards and other type bills. Start a new column on your paper with 1500 dollars as your starting amount.

Then add up how much your minim payments are on those other bills, more then likely, if you are like the main stream of people in debt, even the minim added up with all the other minims are way more then that 1500 dollars. This is where you must pick up a phone and begin calling each creditor of the second set of bills and asking them the hard question, of what can I pay to get this bill paid off?

Take note, that in order to have them help you, you will have to agree to stop using that card and cut it up. Your goal is to do away with the debt. If you'd like to keep one card to just pay the minimum payment on to use for emergency expenses in the future, decide which one to keep by the one with the least amount of interest each month and also look at the one that has the least amount of charges on it.

This will help you decide which one to hang on to. Put that bill along with the must have bills that need to be paid each month. You may then want to deduct that from your remaining figure of 1500 dollars, of which you will use to pay off your unnecessary extra debts. Let us say its 25 dollars a month, so that will leave you with 1475 dollars a month to pay off the cards you are going to do away with.

When calling your creditor have this amount in front of you. Then explain to them the reason you fell behind in your payments, what your current amount is that you are able to pay, in order to pay off this debt, what your are plans to bring this debt up to date and keep it current, including the amount you will be able to pay each month and what your other obligations are, such as your have "to's" that you need to pay every month to keep your family in a home etc… Most credit card creditors are willing to give you a pay off amount and stop charging you interest on the bill. If you talk to them before the bill gets out of hand, or goes without payment for too long.

They also seem to like the fact that you are the one calling them, in order to try to get your bill paid. Be advised that not all that you are in debt with are going to be this cooperative in your dealings with them. However, the rule is that most are.

Keep a firm eye on your credit report. Check it at least once a year. Check for errors, debts you forgot you had etc…Make an effort to contact the holders of debts that you need to clear up and the ones that are errors on your report.

So many people's credit ratings are low scored, because of the credit reporting company placing information on the wrong person's report.

Remember, only you can make sure your credit is good, you are the only one who will care as to whether it is good or not. If you do not keep an eye and a handle on it, no one else will.

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