You can repair your credit yourself -- and save hundreds or even thousands of dollars.

You've probably seen ads for companies that claim they can fix your credit, qualify you for a loan or get you a credit card. Their pitches are tempting, especially if your credit is bad and you desperately want to buy a new car or house.

You should avoid these outfits, however. Many of their practices are illegal. Some have been caught stealing the credit files or Social Security numbers of people who are under 18, have died or live in out-of-the-way places like Guam or the U.S. Virgin Islands, and substituting these for the files of people with poor credit histories. Others have been identified as breaking into credit bureau computers and changing or erasing a bad credit file.

But even assuming that the credit repair company is legitimate, don't listen to its come-ons. These companies can't do anything for you that you can't do yourself. What they will do, however, is charge you between $250 and $5,000 for their unnecessary services.

Here's what credit repair clinics claim to be able to do for you:

Remove incorrect information from your credit file. You can do that yourself under the Fair Credit Reporting Act.

Remove correct, but negative, information from your credit file. Negative items in your credit file can legally stay there for seven or ten years (depending on the type of information), as long as they are correct. No one can wave a wand and make them go away. One tactic of credit repair services is to try and take advantage of the law requiring credit bureaus to verify information if the customer disputes it. Credit repair clinics do this by challenging every item in a credit file -- negative, positive or neutral -- with the hope of overwhelming the credit bureau into removing information without verifying it. Credit bureaus are aware of this tactic and often dismiss these challenges on the ground that they are frivolous, a right credit bureaus have under the Fair Credit Reporting Act. You are better off getting your file and selectively challenging the outdated, incorrect and ambiguous items.