Struggling U.S. homeowners could receive federal loans to pay down as much as 20% of their principal under a proposal introduced Wednesday by the Federal Deposit Insurance Corp. to help stem foreclosures.

The plan would be run through the Treasury Department, which would make the loans.

The program would hinge on the willingness of mortgage servicers and investors to agree to restructure troubled loans, as well as to pay the financing cost of making the federal loans.

"Only the federal government is in a position to help arrest the downward cycle in housing markets by facilitating temporary aid to borrowers facing financial difficulty and encouraging widespread restructuring of unaffordable mortgages," the FDIC said in a document outlining the plan.

FDIC Chairman Sheila Bair, in a conference call with reporters, acknowledged that servicing firms would receive some benefit through the program. She noted, however, that those firms would be required to cover the financing costs and would have to subordinate their claims to the federal government if they choose to take part in the program.

The FDIC is in the process of briefing the Bush administration, lawmakers, and industry and consumer groups. Ms. Bair said she couldn't gauge the response to the proposal, but is hopeful it would receive bipartisan support.

Write to Michael R. Crittenden at michael.crittenden@dowjones.com

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