Increased financial literacy from consumers would have helped dampen some of the effects of the subprime housing crisis, according to Robert K. Steel, U.S. undersecretary for domestic finance, on Wednesday.

The Treasury official added that additional financial education was going to be a key element in helping the housing markets stabilize in the United States.

Steel also urged financial institutions to step-up efforts on preventable foreclosures, observing that many homeowners continued to be nervous about approaching lenders regarding difficulties paying their mortgages.

He failed to discuss upcoming legislation from government regarding a rescue package for distressed borrowers.

By Erik Kevin Franco and edited by Cristina Markham