The Obama administration's wide-ranging foreclosure prevention and housing plan received the expected response on Capitol Hill on Wednesday, with Republicans wary of the scope of the proposal and Democrats heralding its ambition.

"President Obama's plan is bigger and bolder than most everyone thought, which is a refreshing change from the failed attempts of the last administration," said Sen. Charles Schumer, D-N.Y., in a statement.

The Obama plan, which was unveiled earlier Wednesday, marks the most expansive effort yet by the government to combat the record numbers of foreclosures that have weighed on the economy and are at the root of the credit crisis. The plan would set aside $75 billion as part of a series of proposals to help refinance some struggling borrowers, modify the loans of others, and use Fannie Mae (FNM) and Freddie Mac (FRE) to help the mortgage market.

House Speaker Nancy Pelosi, D-Calif., described the plan as a "comprehensive strategy to reduce record foreclosures and stop the nationwide plunge in home values."

"Addressing the foreclosure crisis is essential to get our economy moving again," Pelosi said in a statement released by her office.

Their GOP colleagues were less convinced, wary that the plan would benefit homeowners who made rash decisions or committed fraud to obtain their mortgage.

"I think that this plan will only delay inevitable future waves of the foreclosure crisis, rather than stem the tide," said Rep. Scott Garrett, R-N.J. He criticized the plan for not rewarding people who are successfully making their payments or chose to rent.

House Republican Leader John Boehner, R-Ohio, and GOP Whip Eric Cantor, R-Va., welcomed the plan's announcement by sending President Barack Obama a series of questions on it. These included how the administration will prevent homeowners who receive aid from eventually going back into default, and whether banks would be compensated for making loans "they should have never made in the first place."

Obama was quick to address concerns that the plan could be exploited by homeowners who took risky bets on the housing market. Obama, in prepared remarks for a speech in Phoenix, said the proposal is focused on those who "played by the rules." People whose traditional mortgages are "underwater" will be eligible for refinanced loans, while people with subprime mortgages will be able to modify their loans.

"I also want to be very clear about what this plan will not do: It will not rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans," Obama was to say.

Still, the potential for fraud is a concern for some senators. Sen. Charles Grassley, R-Iowa, said Wednesday he sent a letter to Treasury Secretary Timothy Geithner last week raising the issue and requesting information from Treasury on the foreclosure prevention plan.

"Providing a benefit such as a federal loan modification program to those who committed fraud is bad policy and unfair to the honest borrowers who played by the rules," Grassley wrote in a Feb. 12 letter to Geithner.

Lawmaker opinion will be important as the Obama administration seeks to implement its housing plan. A number of provisions in the proposal, including a rewrite of bankruptcy laws to allow judges to adjust the terms of mortgage loans, will need to be enacted by Congress to take effect.

-By Michael R. Crittenden, Dow Jones Newswires; 202-862-9273; michael.crittenden@dowjones.com