Lenders use new tactics to dig up financial dirt on potential borrowers

Back in the old days (a.k.a. a few years ago), banks would determine if you were worthy of a loan by looking at your credit score and your income. Now, with defaults at near-record levels, lenders are much more cautious about who they give money to, so much so they're willing to violate your privacy and employ sneaky tactics in order to determine whether you're a deserving borrower. In fact, banks and lenders examine many aspects of your financial life that you might think have nothing to do with your loan application or that you assumed were kept private.

"If you collect people's personal data, it will have a value and the information professionals will figure out how to use the data," Evan Hendricks, editor of Privacy Times and author of the book Credit Scores and Credit Reports, told WalletPop. "It's such a ratcheted-up level of surveillance, putting all of us in a fishbowl."