Taxpayers appealing to lawmakers for help with loans

WASHINGTON – Rep. Mel Watt is used to dealing with constituents who need help with government agencies.

But once Congress passed a $700 billion bailout of the banking system, some people started turning to the Charlotte Democrat for help with the private sector. They've asked him to assist their appeals of rejected loan applications from banks that collected federal bailout money.

It's an unusual type of request for Watt, who views the pleas as a sign of the times. An increasingly unsettled American public is looking for help with their own economic hardship but also asking for accountability because banks and other big businesses are getting bailed out by the government.

President Obama is expected to unveil a major program to help mitigate mortgage foreclosure this week, which might be one step toward helping typical Americans manage their finances and stabilizing the economy.

In the meantime, people have been turning to Watt in part because he serves on the House Financial Services Committee, he said.

"People have this notion when they don't get their credit application approved, that because we put money into the banks, that we have greater leverage over those kinds of credit decisions," he said.

But lawmakers have no control over individual lending decisions made by banks.

Congress is trying to unlock credit markets, Watt said, but that's different from helping a particular person get a loan. At the most, his office in a couple of cases has called banks to see if a denied request could be evaluated a second time.

Sen. Richard Burr, R-N.C., who has tried to help N.C. businesses that had their credit lines pulled or reduced, agreed.

"We're not in the business of trying to second-guess whether someone makes the threshold of getting a loan," Burr said.

In some cases his office has tried to connect the businesses to other banks for loans.

Burr said that, by the time some constituents call his office, they're teetering on the brink of bankruptcy.

Watt said he's especially careful about the requests he makes because his seat on the House Financial Services Committee "limits the propriety of what you can do."

"It could be perceived as trading on your congressional influence in an inappropriate way," he said.

In fact, Watt said, avoiding inappropriate intervention also extends to just how much he can do for a large employer, such as Bank of America. Watt said he routinely listens to bank executives and lobbyists on policy matters that might affect their businesses, but can't demand special treatment for individual businesses in a program like the Troubled Asset Relief Program.

Rep. Sue Myrick, a Charlotte Republican, said she, too, fields some complaints from folks having borrowing difficulties.

In Watt's office, most of the requests he gets are still the old-fashioned variety – missing Social Security checks, delayed passport renewals and problems with disability payments.

But the new variety of nongovernment calls he's getting goes beyond just bank loans. He's seeing an increasing number of folks who need credit counseling and help staving off foreclosure. He even got a call from a parent who had regularly been paying tuition but was now in financial distress and fighting to keep her child in school.

In that case, he called the college and asked whether someone else in the chain of command could review the case.

"Maybe that will be helpful, and maybe it won't," Watt said.