When the Senate Banking Committee approved on Tuesday legislation to help suffering homeowners refinance costly loans, lawmakers said they had found a way to rescue the housing market without requiring taxpayers to foot the bill. By forcing the nation's two largest buyers of home loans — Fannie Mae and Freddie Mac — to hand over hundreds of millions of dollars each year, lawmakers said they were creating a fund that the government could tap to refinance as much as $85 billion in troubled home loans. Senators said the plan, which empowers the Federal Housing Administration, or F.H.A., to insure risky loans, would most likely help hundreds of thousands of homeowners avoid foreclosure and stabilize the housing market. But some say that the government's housing plan is riskier than disclosed and that if home prices continue to decline for years, taxpayers could be on the hook for billions. Others complain that the plan creates worrisome pressures for Fannie Mae and Freddie Mac at a time when both companies are struggling with enormous losses and thin financial safety nets. The companies are essential lubricants in today's housing finance market, and if either stumbled, it could set off a worldwide economic slowdown. “There's real concerns about the degree of risk that F.H.A. is taking on,” said Howard Glaser, a mortgage industry consultant who served at the Department of Housing and Urban Development in the Clinton administration. “And everyone is calling on Fannie and Freddie to do more to stabilize the mortgage marketplace, but at what point does imposing new costs on those companies undermine their financial safety?” Lawmakers of both parties say such concerns are baseless. Congressional aides say that the housing plan's estimated $1 billion cost will be more than offset by the $700 million a year that Fannie Mae and Freddie Mac will hand over and by the billions of dollars in new fees the F.H.A. will charge borrowers and lenders. “We believe we've identified more than twice the funding that this program needs,” said Senator Richard C. Shelby of Alabama, the senior Republican on the Banking Committee. “We have to provide relief to people who are at risk of losing their homes, and this is a good start.” The Banking Committee approved the foreclosure rescue plan by a vote of 19 to 2, with 8 Republicans joining all 11 Democrats on the committee in favor of it. Republican Senators Jim Bunning of Kentucky and Michael B. Enzi of Wyoming were the two no votes. The broad consensus on the bill was a stark turnabout after years of partisan debate over how to tighten regulation of Fannie Mae and Freddie Mac and more recent disagreement over whether the government should help troubled homeowners and lenders who might have acted irresponsibly. The Senate agreement underscores the view in both parties that addressing problems in the housing market is a political necessity in a high-stakes election year. Republicans who initially opposed helping struggling borrowers agreed to extend a hand, but only after Democrats agreed to tap Fannie Mae and Freddie Mac, instead of taxpayers, to cover the cost.
