Updated: 5:54 p.m.

The federal bailout of Fannie Mae and Freddie Mac could more than double to as much as $363 billion within the next three years, according to an estimate by their regulator.

The Federal Housing Finance Agency found that taxpayers could be on the hook for $221 billion to $363 billion through 2013. It used three scenarios to project losses for the mortgage giants, which were taken over by the federal government in September 2008 during the financial crisis.

Treasury has already pumped $148 billion into the two enterprises, which play a vital role by owning or guaranteeing more than half of the home loans on the market. But administration officials said that the worst is over for both mortgage giants, and predicted that taxpayers will get some of the bailout money back.

Edward DeMarco, acting director of the Federal Housing Finance Agency, said that the losses are primarily from faulty loans that the two bought before they were taken over.

In future years, the costs will be attributed to dividend payments to Treasury's preferred stock it has taken in Fannie and Freddie, meaning that much of the paid-out funds would ultimately go back to the federal government.

If the dividend payments were excluded, the losses would range from $142 billion to $259 billion.

The study found that the two would need $221 billion in support under a "stronger near-term recovery." If housing prices stay on their current baseline path, the total would reach $238 billion. A "deeper second recession" in housing prices is projected to cost $363 billion.

The Obama administration said the study reaffirms that that Fannie and Freddie have made great strides since they were placed in conservatorship, with the vast amount of the losses coming from loans issued from 2005 to 2007. Mortgages purchased within the past two years have required higher down payments and went to borrowers with higher credit scores.

"Today's projections show that in the most likely economic scenario, nearly 90 percent of the losses at Fannie Mae and Freddie Mac are already behind us, and that almost all of those losses are attributable to mortgages that were already on those businesses' books prior to the conservatorship," said Jeffrey Goldstein, Treasury Undersecretary for domestic finance.

A senior Treasury official said there are no plans to reexamine the dividend payment, which stands at 10 percent, unless it is within the context of a revamp of their operating structures.

Congress is gearing up to overhaul the housing finance system next year, with Republicans advocating privatization of Fannie and Freddie. Rep. Spencer Bachus, R-Ala., who is poised to take the gavel of the House Financial Services Committee if the GOP regains the House, has expressed skepticism of any new government guarantee for the home-loan market, a position that most industry groups back.

The administration will release its proposal in January amid indications that it will support some sort of government backstop, although vastly different from the current structure of the two.

Outside of its policy implications, the report has political consequences as voters go to the polls in 12 days for midterm elections. Republicans used the projections to argue that Fannie and Freddie are poster children for a bailout mentality that has prospered under the Obama administration.

"Taken together, Fannie and Freddie were the single, biggest driving force behind the financial collapse. And yet, the federal government continues to prop them up with one blank check after another. No matter what the final cost, the bailout of Fannie and Freddie will be by far the most expensive component of the federal government's intervention into the financial system," said Rep. Scott Garrett, R-N.J.

The report also overshadows efforts by Treasury, highlighting that costs of the Troubled Asset Relief Program are much less than expected, with a projected $50 billion loss from its overall $700 billion authorization.