[Nifty3929]

"looks at my income - expenses then checks if I've defaulted on any debts" - This is basically what we do in the US as well. But HOW do they do this in your country?

In the US, the loan originators look at year-end tax forms or recent pay stubs to verify income. They look at credit reports from e.g. Experian to verify defaults and other debt information.

[worksonmine]

The paychecks are verified at the bank, probably tax as well. For the debts we have a government authority which is usually the last resort for creditors. This authority also takes care of getting your cash, selling belongings etc to pay off creditors.

This is all open data and can be verified with just a phone call to the tax office and debt authority. Some private aggregators exist for convenience but they're regulated in what they're allowed to share and for how long.

The private companies are also required to notify me anytime someone checks my score, the government agencies aren't.