WASHINGTON — Key senators announced Monday a bipartisan agreement on the broad elements of a plan to avoid foreclosures and speed the refinancing of mortgages for roughly 500,000 troubled homeowners without taxpayers footing the bill.
The deal, full details of which were not spelled out, reflects the election-year pressure that lawmakers feel to find common ground on one of the most pressing issues facing the country. The housing collapse has inflicted pain on thousands of families, dealt the economy a major blow and ignited a fierce controversy over what -- if anything -- the government should do about it.
Despite the agreement, the measure still faces substantial hurdles: passage by the full Senate; approval by the House, which has its own home rescue plan; and signature by President Bush, who has threatened to veto the House's version.
The lead Republican on the Senate Banking Committee, Sen. Richard C. Shelby (R-Ala.), expressed optimism that a new financing arrangement agreed to Monday would attract more support from his Republican colleagues, who have voiced concern about any measure that could be seen as a government bailout of speculators.
"My primary consideration during negotiations on this package has been to protect the American taxpayer, and I believe we've made significant progress toward that goal," Shelby said in a statement.
Some Republicans have supported other versions of the legislation, citing the severity of the housing crisis and the escalating number of foreclosures in some regions of the country, including parts of California. They argued that the foreclosure crisis would damage entire communities and pull the economy toward recession.
But other Republicans argued against any government assistance, saying it would reward borrowers and lenders who made bad decisions out of carelessness or greed.
Shelby was considered a key player because he belonged to the latter group. "I've long said that we should do what we can to help struggling homeowners, short of asking the taxpayer to foot the bill," he said Monday.
White House reaction to the emerging deal was muted. In public comments, Bush did not repeat his previous veto threat, saying only that "we look forward to working with Congress to get a good piece of legislation to my desk that helps our fellow citizens and helps us get through this housing issue."
