Bankruptcy and debt settlement have emerged as the top most choices for debt relief. Before you take a call, you need to get your facts right. Here are a few basic questions about bankruptcy that you need to ask yourself before making any kind of decision on debt relief.

1. What is meant by bankruptcy? It is a procedure that is mandated by federal law to provide protection to US citizens looking for debt relief.

2. What is the protection given to me by bankruptcy? Bankruptcy provides two types of protection, the first for your current assets, and the second, for your future earnings.

3. I am so deep in debt that I will lose my home. Will bankruptcy save my home? Many state laws provide homestead protection, that can be either unlimited or up to a given limit. You will lose your home only if your state provides no homestead protection at all.

4. Do I go in for Chapter 7 or Chapter 13? Chapter 7 is a straight bankruptcy. You will be permitted this if your current assets are so bad that you can not pay off the debt in any manner. Chapter 13 revised will block portion of your future earnings, if you have any, to overcome debt in 3 to 5 years.

5. What will happen to my credit? It can 8 to 10 years to revive your credit score. Talk to a qualified bankruptcy attorney to determine the liklihood of your particular credit scenario based on which type of bankruptcy you file and the level of your debt.