There are many legal definitions for credit, but the bottom line is that credit means borrowing money from a lender to pay for something. You may be borrowing from a bank, a retail merchant, or a mortgage company. The person you want to borrow money from extends credit to you.

This means that they are going to let you have a product now that you will pay for later. When you borrow money, you make an agreement with the lender on how you will repay the loan.

In addition, you will usually pay a loan back with interest. This is a percentage of the original money that you borrowed that is tacked on to the loan. Adding interest charges is how a lender makes money.

Credit can be both a blessing and a curse. Most people couldnt afford to pay up front for a home that costs $150,000. However, many can budget monthly installments to pay a mortgage. The same is true for the purchase of an automobile. Credit can also help you in an emergency. For example, when your car breaks down and you need to put your car repairs on a credit card.

For many, though, credit seems like free money. You want a new outfit or some new sports equipment, but you dont have the cash in your bank account. Its very easy to whip out a credit card and get what you want now but pay for it later. Unfortunately, if you consistently spend more money than you earn, you can get in over your head in debt.

While a home is usually considered a good debt, if you borrow money for a house you cant really afford, youll be in the same boat. You can end up falling behind on payments or even foreclosing.

If youre already in the position of having bad credit, then you know how easy it is to fall into the credit trap. You may feel overwhelmed and even feel like theres no way out. Whats more, its hard to know where to turn to for help.

Talking about problems with your finances is usually not comfortable. In fact, many people who seem to be living high on the hog are really drowning in debt but youd never know it by looking at them.

To download your copy of "The Free Credit Repair Kit - Version 2006", you can visit my website at http://www.fixitcredit.com.