Housing rescue: What you need to know

In brief: The Bush administration is reportedly preparing a foreclosure rescue plan that would ask lenders to reduce mortgage balances for some of the nearly 9 million borrowers with negative equity.

These homeowners could seek refinancing into affordable, FHA-insured, fixed-rate loans as long as they meet FHA-underwriting guidelines such as those requiring borrowers to pay less than 43% of their income on mortgage debt.

The argument: Lenders would take a hit but would trade "upside down" mortgages, ones in which borrowers owe more than their homes are worth, for more secure, government-insured ones.

Who support this: Generally, any expansion of help for troubled borrowers -- even incremental help -- has been welcomed by community advocates and foreclosure prevention counseling organizations.

Who's against it: The plan is likely to be criticized as not going far enough to help homeowners.

Taxpayer price tag: There should be no direct costs for taxpayers, but there would be some administrative expenses and FHA would be exposed to more risk.

NEXT: Wall Street's plan: Freddie, Fannie to the fore