The chairman of the House Financial Services Committee on Tuesday pressed the Treasury Department to use money from the financial rescue program enacted last month to reduce home foreclosures.

Chairman Barney Frank , D-Mass., a primary architect of the law, said lawmakers were “disappointed that funds are not being used out of the $700 billion to supplement mortgage foreclosure reduction.” Panel members aggressively grilled Treasury Secretary Henry M. Paulson Jr. and Federal Reserve Chairman Ben S. Bernanke about the bailout program, with many Democrats pushing for the government to do more to help struggling borrowers.

The law — dubbed the Troubled Assets Relief Program — was originally designed to allow Treasury to buy up troubled mortgage-backed assets that have caused a cascade of financial problems. Once the department purchased those toxic assets, the law called on Treasury to use its position as the new owner of mortgage paper to help reduce foreclosures by allowing the underlying home loans to be modified.

But Paulson has changed course, abandoning his plan to buy up illiquid assets and opting instead to make direct capital infusions into banks in an effort to unfreeze the credit markets and get banks lending again. That has orphaned the foreclosure reduction plan.

“It is essential that do we something to use some of the TARP funds for the diminution of the rate of mortgage foreclosure,” Frank said.

Paulson said he was “going to keep working on this,” but said the bailout law focused on buying and selling assets, not a “direct subsidy” for modifying mortgages.

Frank strongly disagreed, saying the inclusion of foreclosure prevention language was essential to winning congressional support for the bailout bill in the first place. “It is nobody’s view that we have been as successful as we need to be in reducing foreclosures,” Frank said.