WASHINGTON, D.C. (MCT) - After the requisite finger-pointing and blame-laying, Congress and federal regulators are moving toward some fixes to problems in the subprime mortgage market, a segment that caters to borrowers with spotty credit histories and whose problems threaten the broader U.S. economy.

Congressional Democrats seem ready to bring mortgage brokers and non-bank lenders - both of whom are at the heart of the subprime meltdown - under some sort of federal regulation.

A more difficult debate continues, however, over how to make Wall Street share some of the responsibility for bad home loans that are pooled together and sold to investors as mortgage bonds.

After several months of hearings, this much is clear: Lenders are going to get explicit federal guidance about riskier home loans in response to what's now widely viewed as dangerously loosened lending standards.

"We have to put limits on what kinds of loans people make. They shouldn't be lending people a lot more money than they can pay back," said Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee.

In an interview with McClatchy Newspapers, Frank said he expects Congress to pass housing legislation "probably this calendar year" and expects it to be comprehensive.

Key Republicans and the White House are cool to the idea of new regulation legislation.

"Industry-based solutions are preferred to government intervention when addressing problems in the private marketplace," said Sen. Richard Shelby, R-Ala., the ranking Republican on the Senate Banking Committee.

White House spokesman Tony Fratto agreed: "We are going to pay attention to the ideas in Congress, but we're not inclined to support a legislative solution or look at legislative options."

But Frank believes that once housing legislation begins moving forward, Republicans will have a change of heart "because they otherwise would be vulnerable. They may not be vulnerable in the abstract, but I think they would be if they voted against it."

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