The Obama administration is expected to extend the life of the 700 billion U.S. dollar financial bailout fund until next October, administration officials said on Tuesday.

One official said the administration was likely to pledge to use no more than 560 billion dollars from the fund. Another said the plan would be to tap the program to help homeowners secure mortgages through the government’s housing program and to free up credit for small businesses to spur job growth.

The financial rescue program, which has been used to plough money into banks, insurer American International Group and troubled automakers, was approved by Congress in October 2008 at the height of the credit crisis. However the stimulus package is set to expire on 31st December if a decision to extend it is not made.

U.S. Treasury Secretary Timothy Geithner told Congress last week that much of the 700 billion dollars lawmakers had authorized to salvage the banking system would not be needed. But he said it would also be a mistake to shut down the program entirely.