A group of senators in the US congress are set to complete a plan to liquidate Fannie Mae and Freddie Mac (FMCC) and replace the failed bank with a government reinsurer of mortgage securities with private capital.

The new plan would require private financiers to accept first-loss position for covering steep losses, according to the draft of the plan. The senators are planning to introduce the plan within this month for the plan to be implemented soon. The bill, which is expected to be passed into a legislation soon, is being written by Tennessee Republican Bob Corker and Virginia Democrat Mark Warner. The group involves senators from both sides of the political divide in the US congress.

The Federal Housing Finance Agency had earlier estimated that the company’s will pay between $32 billion and $78 billion to the U. S. Treasury until 2015. The regulator said in a report that the companies will own $76 billion to the tax payers by 2015, compared to an earlier estimate of $142 billion.

Experts have said that the bill is the first bipartisan effort to shape the new housing finance system in the US as the housing market begins to show signs of stable recovery.