WASHINGTON — A dozen financial groups, including the U.S. Chamber of Commerce and American Bankers Association, today urged every member of the U.S. Senate to reject a key piece of President Barack Obama's plan to keep tens of thousands of Americans from losing their homes.

The letter to senators was the latest push by an industry that has helped stall the proposal, which would have let debt-ridden homeowners reduce their payments in bankruptcy court. The Senate is expected to defeat the measure on Thursday.

The plan faces nearly unanimous opposition by Republicans and has caused hesitation by several Democrats who say they share industry's concerns that the forced easing, or "cram-down" of mortgage terms would ultimately drive up interest rates and further freeze credit lines.

"The housing market is already unstable, and enacting cram-down legislation would make things worse by adding even more risk to the mortgage market, effectively undermining efforts by Congress and the administration to stabilize housing," the bankers wrote in a letter sent to each senator.

In February, Obama announced his plan to save some 9 million debt-ridden individuals from losing their homes by providing incentives to lenders to cut homeowners' monthly payments or refinance loans for individuals whose home's market value has sunk below what they owe.

As part of the plan, Obama said he also wanted to change bankruptcy laws so a judge can reduce a person's mortgage payment based on its market value if the homeowner had otherwise been unable to modify their loan.