Most people clean a house before they move into it. In that same vein, you should clean up your credit history before you shop for a mortgage loan. Whether you plan to buy a house or refinance your current home, make sure your credit report is as clean as possible so you can keep your loan costs low.

Your credit history probably will be the single most important factor affecting how close the rate you actually get is to the "best rate available," says Catherine Williams, vice president for education at Money Management International, a nonprofit credit counseling service in Chicago. If your credit is in less-than-stellar shape, you need to work to clean up your record rather than try to "repair" it.

Williams advises people to avoid so-called credit "repair" services that, for a fee, promise quick fixes to credit problems, saying they do not work. Instead, if you have black marks on your credit report because you didn't pay your bills on time, "You're going to have to take a deep breath and realize that it's going to take some time to clean it up," she explains. "You actually need to heal your credit. Only time and good payment habits can repair the negative things on your credit report." Doing that takes time, often 18 months to two years. But a bad credit report doesn't mean you must put your home-buying or refinancing plans on hold. It does mean that you need to have a good idea of what interest rate your credit history will entitle you to, how to improve that credit history, and how to prevent it from worsening again.

Before doing that, you need to make sure that all the information on your credit report is accurate. That is when you might discover some credit problems on your record that are not of your own making. One growing problem right now is identity theft, and victims' credit reports are among the first places where its damage shows up. Credit theft, however, is not the only problem. The three major credit-reporting services handle millions of files and transactions daily. They make mistakes, but it's up to you to catch those mistakes. So you need to check your credit reports regularly for fraud and errors.

Under a new law currently being phased in nationwide, you are entitled to one free copy of your credit report from each of the three major credit-reporting agencies-Equifax, Experian and TransUnion-every year. Since each agency has its own way of receiving, recording and reporting information, it is important to know what each of them says about you. After all, you don't know which agency a specific lender will use. So, you might want to get all of them at once. You can contact Equifax at (800) 685-1111 or online at http://www.equifax.com. Experian is (888) 397-3742 or http://www.experian.com, and TransUnion is (800) 888-4213, or http://www.transunion.com. Make sure you indicate you want your free credit report and realize that your credit score might NOT be included as part of the free report but as a separate paid product.

Or you may choose not to order all three at the same time. You can get one from Equifax now, for example, and then one from Experian in four months and one from TransUnion four months later. Four months after that, you can get a new copy from Equifax, and so on. That way you check one of them every four months, and each of them once a year.

If there are mistakes on your credit report-and there often are-you can send a letter to the reporting agency challenging a black mark by explaining your side of the story and asking for a correction. Each agency has its own procedure, and each agency will "suspend" the negative report while it investigates your request. Each of the agencies explains its own procedures on its website and in its credit reports. Williams points out that new data are fed to your credit report regularly, so it is important to make sure that all the new information that comes in is positive. Start paying your bills on time every month because that gets noted on your report, too.

"Remember that there are other factors beside your credit history," she adds. "All things being equal, if you have a good payment history and an increase in your income, and if you haven't created any more new debt, then the chances are you will be able to get at least a market rate for a mortgage." Your credit report does not show how much money you make, just how well you pay what you owe. While it is important to pay off your debts, it doesn't help to play a "shell" game with debt by switching it from one credit card to another. In fact, Williams says you might be better off keeping just one credit card, since that will help you understand how much debt you really have and how much it is costing you each month in interest.

She advises people with credit questions or concerns to go to a nonprofit credit counseling service. Some people go to them once they already are buried in debt. Smart ones go there before they get overwhelmed so they can learn how to handle debt and avoid getting buried. Williams' firm, Money Management International, at www.moneymanagement.org or (866) 889-9347, provides such services. Other similar companies are Consolidated Credit Counseling Services (CCCS) at www.consolidatedcredit.org or (800) 320-9929, and Family Credit Counseling Service at www.familycredit.org or (800) 994-3328.

Williams says there really isn't anything complicated about cleaning up your credit history and notes that even if you wind up paying a little more now for a mortgage because of your spotty credit record, you can always refinance when your credit history is in better shape. That doesn't mean it is easy, however. "Reduce both the number of cards you own and the amount you owe. Pay your bills on time and don't spend more money than you make," she adds. "It sounds trite but those rules of thumb still apply and they are still very solid." The sooner you start to make a serious effort to do a better job with your credit, the more likely it is that your cleanup work will pay you back with a better interest rate when it's time to go shopping for your mortgage loan.