Dodd said he will hold hearings next week on the measure aimed at providing cheaper mortgages backed by the government, The Washington Post (NYSE:WPO) reported Saturday.

The Connecticut Democrat's proposal would allow the Federal Housing Administration to encourage lenders to forgive a portion of a loan and issue a more affordable mortgage that would be backed by the federal government.

A similar proposal introduced by House Financial Services Committee Chairman Barney Frank is pending in the House.

He and Dodd said they hope to have a vote on the plans in their respective chambers by the end of May.