NEW YORK (CNNMoney.com) -- The Senate on Tuesday is expected to pass a package of housing measures intended to stabilize the housing market.
But that bill - crafted in 24 hours of bipartisan negotiation last week - faces an uncertain fate as the House gets ready to have its say on how best to address the nation's foreclosure crisis.
The House is expected to craft its own bill and not simply follow the Senate's lead. In addition, House leaders have indicated they might also pursue proposals to address other problems in the economy - a move that could complicate speedy approval of any foreclosure provisions.
"This is not a quick, easy conversation to have," said Clint Stretch, managing principal of tax policy at Deloitte Tax.
But the pressure is on for lawmakers to act swiftly to prevent a substantial number of foreclosures. Nationwide, 1.5 million subprime adjustable-rate mortgages will reset to higher interest rates this year, putting many of those homeowners at risk of falling behind on their payments and losing their homes.
Critics of the Senate package say the measures do more for businesses and lenders than they do for homeowners at risk of foreclosure. If House leaders have their way, the House bill will contain measures more targeted to keep troubled borrowers in their homes.
The House's efforts on housing have so far been led by Financial Services Chairman Barney Frank, D-Mass. Frank is scheduled to start two days of hearings on Wednesday to debate his proposal to let the Federal Housing Administration (FHA) insure $300 billion in troubled loans if lenders voluntarily write them down to at least 85% of the homes' appraised value.
Some political observers say that the FHA proposal may be the centerpiece of the House bill. But the Senate chose to exclude in its housing package a similar proposal from Senate Banking Chairman Chris Dodd, D-Conn.
Meanwhile, Charles Rangel, D-N.Y., the chairman of the powerful House Ways and Means Committee, will on Tuesday propose the Housing Assistance Tax Act. That bill is expected to offer measures that directly benefit homebuyers and homeowners and may also include an expansion of the low-income housing tax credit.
Stimulus 2.0 on tap?
Looking beyond the mortgage crisis, House Speaker Nancy Pelosi, D-Calif., and other House leaders will seek to put together an economic stimulus bill that is expected to contain measures that were cut from the first stimulus bill passed in February.
They are likely to call for an extension of unemployment benefits, an increase in food stamp payments and more funding for infrastructure repair. Whether such measures would be included in a housing package or passed separately isn't clear yet.
Congressional leaders are scheduled to meet with President Bush on Wednesday.
"We will urge him to focus on the economy and work in a bipartisan manner on a new stimulus package to help America's working families. We must work together to restore consumer, market, and worker confidence," Pelosi and Rangel said in a joint statement Monday.
The president, meanwhile, will likely urge Congress to let the first stimulus package take effect before deciding what to do next. Taxpayer rebates, the centerpiece of that legislation, will start going out in May.
"My only advice to [Congress] is, one, make sure you give the pro-growth package that was passed overwhelmingly a chance to work, see what the effects are," Bush said Monday.
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