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By David M. Herszenhorn
Washington - A bipartisan effort in the Senate on tax breaks to stabilize the housing market and other aid for homeowners at risk of foreclosure began to crumble on Tuesday, as the White House threatened a veto, saying the bill would only make things worse.
House Democrats, meanwhile, said they would pursue their own, more expansive homeowner assistance bill, and would support only a few provisions in the Senate measure.
But even as the White House reiterated its opposition to government help for irresponsible lenders and speculators, there were signals that it was prepared to endorse broader aid for struggling homeowners - provided that it did not involve new legislation sought by Democrats.
In a draft of testimony to be delivered before the House Financial Services Committee on Wednesday, Brian D. Montgomery, the commissioner of the Federal Housing Administration, said the administration would look to expand a program to help refinance the mortgages of borrowers struggling with subprime adjustable-rate mortgages. But the draft urges Congress not to overreach.
A spokesman for the Department of Housing and Urban Development, Stephen C. O'Halloran, cautioned that the draft text could change. But the testimony seemed likely to set the stage for continued wrangling over the competing homeowner-aid proposals in the weeks ahead.
The relatively modest Senate bill contains tax breaks for struggling businesses, including home builders; a $7,000 tax credit for buyers of foreclosed properties; $10 billion in tax-exempt bonds for local housing agencies to refinance troubled loans; $4 billion for local governments to buy foreclosed properties; and $100 million to counsel borrowers.
In an effort to speed the bill's passage, Senate Democrats had agreed to delay a broader effort to assist troubled homeowners by authorizing up to $300 billion in federally insured mortgages, enough to help as many as 1.5 million borrowers refinance expensive adjustable rate loans into more stable and affordable 30-year loans.
The dimming prospects of the relief package seemed incongruous with the 92-to-6 vote on Tuesday afternoon, by which the vast majority of Democrats and Republicans, including all three leading presidential candidates, voted to curtail debate and move toward its final passage on Wednesday.
At the White House, however, the press secretary, Dana M. Perino, called the legislation ill-conceived. "The bill will likely do more harm than good," she said, "by bailing out lenders and speculators and passing on costs to other Americans who play by the rules and honor their mortgage debt obligations.".
Ms. Perino also suggested that the Senate bill could be irrelevant, citing a desire of many House Democrats to go further. "Fortunately, it doesn't appear that likely that this bill will come to the president's desk," she said, "as the House has indicated that it plans to go its own way."
The comments from the White House seemed to blindside Senator Mitch McConnell of Kentucky, the Republican minority leader, who earlier in the day repeated his strong support for the housing bill.
At a news conference, Mr. McConnell said he was not prepared to respond to the criticism from the Bush administration. "It was unclear that the White House had a stated position yet on this bill," he said.
House Democrats did not dispute Ms. Perino's assertion that they planned to pursue a more aggressive rescue plan for homeowners.
Those efforts are expected to accelerate throughout the week as hearings begin on a Democratic plan to expand the availability of loans insured by the federal government and to help troubled borrowers refinance.
Representative Barney Frank of Massachusetts, who is the main author of that plan, said House Democrats were prepared to endorse some aspects of the Senate bill, including the money for local governments to buy foreclosed properties, bonds for refinancing and a proposal to "modernize" the F.H.A.
House Democrats also have their own version of a provision in the Senate bill that will create a property-tax deduction up to $500 for individuals and $1,000 for couples who do not itemize deductions on their tax returns.
Mr. Frank, who has forged a solid working relationship with Henry M. Paulson Jr., the Treasury secretary, said in an interview that he remained hopeful of winning administration support for his more expansive plan to help borrowers with more insured loans.
Also in the House on Tuesday, Representative Charles B. Rangel, Democrat of New York and chairman of the Ways and Means Committee, introduced tax legislation aimed at helping homeowners and first-time home buyers.
Mr. Rangel's bill would give individuals and families a refundable credit, akin to an interest-free loan, of as much as $7,500, or 10 percent of the purchase price of the home. The money would have to be repaid over 15 years in equal installments.
House Republicans issued a set of House Principles on Tuesday that they said should frame the debate over any legislation. Among them: "The best way out of the housing crisis is to get Americans purchasing homes again. The housing market needs a jump-start, not a bailout."
The Republicans also said they opposed "a taxpayer bailout that rewards reckless behavior."
Mr. Frank said that Democrats shared many of those goals, and noted that his proposal would not use tax revenue to pay off troubled mortgages.
But whatever common ground House Republicans and Democrats might share, the parties seemed likely to clash over the housing issue for weeks to come. A recent Gallup poll showed sharply different views on the issue among voters. A majority of Democrats favored government help for troubled homeowners; a majority of Republicans opposed it.
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