WASHINGTON — A mortgage rescue to help hundreds of thousands of struggling homeowners avoid foreclosure and get more affordable, safer loans passed the Senate overwhelmingly Friday, but it faces a bumpy road amid continuing turmoil in the housing market.
The 63-5 vote reflected a keen interest by Democrats and Republicans to send election-year help to distressed home owners.
The plan lets homeowners buckling under mortgage payments they can’t afford keep their homes and get more-affordable mortgages backed by the Federal Housing Administration. Banks that agree to take substantial losses on those loans could be assured of recovering at least some money.
The new program would let the FHA insure as much as $300 billion in new mortgages, helping an estimated 400,000 homeowners.
It still faces challenges, with the House planning to rewrite key details and the White House threatening a veto.
Key players are bracing for intense negotiations to resolve the differences. They hope to smooth over disputes with the White House at the same time, with an eye toward producing a bill President Bush could sign this month.
