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The \textit{logistic function} is fit to the data. Regerring to the plot above, the model (blue curve) can take in the balance and output the probability of default. Notice that it does tell you if the person defaults or not; it tells you the probability of default. In order to perform classification, you must choose a cutoff, say 0.5, where all values above are predicted as default and all below are predicted as not default.
\textbf{Starting Out}
\begin{enumerate}
\item Introducion to Statistical Learning (ISLR) - section 4.3
\item Advanced Data Analysis from an Elementary Point of View - chapter 7
\item An Introduction to Generalized Linear Models - chapter 7
\end{enumerate}