WASHINGTON--Democrats' plans to help hundreds of thousands of homeowners struggling with rising subprime mortgage rates and plummeting house values could be sidetracked by President Bush's threatened veto and the backing of many congressional Republicans.

Opponents of the plan say more prudent homebuyers and renters shouldn't be called upon to bail out borrowers who gambled on ever-rising housing prices and lost.

"The American people don't want to make their neighbor's payment when they're having trouble making their own," said Rep. Randy Neugebauer, R-Texas.

The Democratic-controlled House on Thursday passed a homeowner rescue plan that would provide cheaper, government-backed mortgages to half a million debt-ridden borrowers and bolster an economy crippled by the housing crisis. The House approved the measure by a vote of 266-154, with 39 Republicans -- mostly from areas suffering worst from housing woes -- supporting it.

Defying veto threats, the House voted to let the Federal Housing Administration take on up to $300 billion in new mortgages so that financially strapped borrowers facing foreclosure could refinance.

The plan by Rep. Barney Frank, D-Mass., is the centerpiece of a broader package of bills approved Thursday that Democrats say will prevent more foreclosures and help homeowners and communities deal with the fallout from the mortgage crisis.

The measure is targeted at homeowners facing default, including many who owe more than their houses are worth.

For instance, a homeowner who owes $290,000 on a house now worth $225,000 could refinance into an FHA-backed loan if the mortgage holder was willing to take a loss of about 36%. The borrower's monthly mortgage payments would fall from $2,200 to about $1,200.

Loan holders would have an incentive to participate, proponents believe, since the alternative would be costly foreclosures, which can involve losses of 50% or more.

Supporters hope the package -- which awaits action in the Senate -- will serve as the basis for a broad bipartisan housing compromise that could satisfy both parties' keen appetite for delivering election-year aid to anxious constituents.

But Bush's veto warnings, backed by staunch GOP opposition, are clouding its prospects.

"House Democrats passed bills that they know will never become law. Most Americans understand that we shouldn't create a taxpayer-funded bailout for lenders and speculators," said Tony Fratto, a White House spokesman.

Under Frank's plan, homeowners currently considered too risky to qualify could refinance into FHA-backed loans if their lenders agreed to take substantial losses on the original mortgages. Borrowers would have to show they could afford to make payments on the new loans. They would have to share with FHA at least half of their proceeds if they profited from selling or refinancing again.

The plan is projected to cost $2.7 billion over the next five years.

The House on Thursday also passed, 239-188, a bill to send $15 billion to states to buy and fix up foreclosed property. Bush has threatened to veto that measure also, contending it rewards the very lenders who helped caused the housing chaos and could act as an incentive for them to foreclose rather than find ways to help struggling borrowers stay in their homes.

The bills are H.R. 5818 and H.R. H830