WASHINGTON - Federal Reserve Chairman Ben S. Bernanke, battling a dangerous wave of foreclosures nationwide, urged lenders yesterday to offer new relief for distressed homeowners, including lowering the amount of their loans.

"This situation calls for a vigorous response," Bernanke said in a speech to a banking group meeting in Orlando.

Even with some relief efforts under way by industry and government, foreclosures and late payments on home mortgages are likely to rise "for a while longer," Bernanke warned.

Rising foreclosures threaten to worsen the problems in the housing market and for the national economy, which many fear is on the verge of a recession or in one already.

"Reducing the rate of preventable foreclosures would promote economic stability for households, neighborhoods, and the nation as a whole," Bernanke said. "Although lenders and servicers have scaled up their efforts and adopted a wider variety of loss-mitigation techniques, more can, and should, be done."

One of his suggestions was for mortgage and other financial companies to reduce the amount of loans to provide relief to struggling owners.

"Principal reductions that restore some equity for the homeowner may be a relatively more effective means of avoiding delinquency and foreclosure," Bernanke said.

Bernanke acknowledged this might be a tough sell to lenders, who typically are reluctant to write down principal.

"They say that if they were to write down the principal and house prices were to fall further, they could feel pressured to write down principal again," Bernanke said.

Tom Loonan, vice president of the State Bank of Easton in Minnesota, suggested that debt relief for some who got in over their heads may anger others, who took out mortgages that they could afford. "There's going to be some animosity," he said.

Still, Bernanke suggested such longer-term, permanent solutions may work better than shorter-term and temporary ones, where the distressed homeowner could find himself in trouble again.

So far, permanent loan modifications have typically involved a reduction in the interest rate, while reductions of the principal balance of the mortgage loan have been quite rare, Bernanke said.

"Measures that lead to a sustainable outcome are to be preferred to temporary palliatives, which may only put off foreclosure and perhaps increase its ultimate costs," he said.

Brookly McLaughlin, a spokeswoman for the Treasury Department, which has been leading the Bush administration's relief efforts, noted that foreclosures were expensive for both lenders and homeowners, giving parties an incentive to renegotiate a mortgage contract.

This year, about 1.5 million loans - representing more than 40 percent of the outstanding stock of subprime adjustable-rate mortgages - are scheduled to reset to higher rates, Bernanke said. The Fed estimates that the interest rate on a typical subprime ARM scheduled to reset in the current quarter will increase to about 9.25 percent from just above 8 percent. That would raise the monthly payment by more than 10 percent, to $1,500 on average, he said.

On Capitol Hill, several measures have been offered to help stressed homeowners.

Rep. Barney Frank (D., Mass.), chairman of the House Financial Services Committee, welcomed Bernanke's call for more action. "It is now clear that we will not be able to avert a more serious and prolonged economic slowdown if we don't address the problem of increasing mortgage foreclosures," Frank said. "Bernanke's willingness to work with us in a cooperative way and his outline of the principles that we should be applying are very hopeful signs."