Having debt written off can provide temporary relief, but it's not the clean slate many borrowers imagine (or hope for). J Studios/Getty Images

If your credit card or personal loan debt has spiraled out of control , which is the case for a lot of borrowers in today's economic climate, hearing that a creditor "wrote off" your balance might sound like a relief. After all, if the lender you owe money to has officially decided it's uncollectible, doesn't that mean you're off the hook for the balance?

Well, not exactly.

A debt write-off doesn't mean forgiveness . It's more like a shift in who's handling your debt and how it appears on your credit report . Lenders typically write off unpaid debt when they've exhausted their collection efforts and no longer expect you to repay it

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