They take average paying morale in a neighborhood into account. But I guess one very bad seed can spoil pull down a otherwise good/average neighborhood.
Image search for "schuldneratlas" (a detailed map of private households in distress) to get some impressions.
Or see there: http://www.boniversum.de/schuldneratlas/
http://en.wikipedia.org/wiki/Commercial_mail_receiving_agenc...
https://ribbs.usps.gov/index.cfm?page=mtcsa
(you can also google for dpv cmra)
Do these creditors think that people have the moral fortitude of five-year-olds?!
They want to make as many loans as possible. The want to loan you money or grant credit. But if they find a correlation that indicates too much risk they'll say no.
The questions then are, is the correlation real, and is doing the correlation legal in the local jurisdiction.
Profiling people (who have nothing to hide) gives banks and insurance companies huge advantage. It may look insane in personal level, but there is solid math behind many of their descisions.
