Some sources said the Committee on Standards and Privileges' report would highlighterrors of judgment that would cast doubt on the former trade and industry minister's early return to government.
The committee was split over a finding by Elizabeth Filkin, the Parliamentary "watchdog", which showed that Mr Mandelson's dealings with his building society fell below the standards expected of an MP. After a deadlock over 10 meetings, members reached a compromise which allowed them to water down the ruling without being seen to reject it.
Ms Filkin found that Mr Mandelson should have informed the Britannia Building Society about the loan. When he applied for a mortgage, he is believed to have said his family would cover part of the pounds 465,000 asking price for the house in Northumberland Place.
Although Mr Mandelson did not tell Britannia about his arrangement with Geoffrey Robinson, then Paymaster General, the building society issued a statement in January saying it was taking no further action and that it was satisfied the information in the mortgage application was correct.
However, a subsequent biography of Mr Mandelson by The Independent's chief political commentator, Donald Macintyre, said the MP and Mr Robinson discussed the loan during the summer of 1996. Mr Robinson, a multi-millionaire, told Mr Mandelson he could "tide" him over until he inherited about pounds 500,000 from his mother. The two men went house hunting together, driven around by Mr Robinson's chauffeur.
Today's report will uphold a complaint from the Conservative MP, John Redwood, that Mr Mandelson should have registered the loan because he had received a preferential interest rate. Mr Mandelson has entered the loan in the register, and has sold the house to move temporarily to a rented flat.
Mr Redwood argued that Mr Mandelson could not have borrowed the money commercially on an MP's salary, which was pounds 43,000 at the time.
Although today's report will embarrass Mr Mandelson by casting a renewed spotlight on the events surrounding his resignation, he is bound to be relieved that the committee has finally reached a conclusion. Three complaints were made in January to Ms Filkin about the loan, and she reported to the committee in April.
Mr Mandelson has been at the centre of speculation about his possible return to government in a Cabinet reshuffle expected later this month. However, a party job, helping a newly-appointed party chairman run elections campaigns, seems a more likely prospect for the immediate future.
Yesterday, at a union conference, Mr Mandelson spoke of how he felt "disorientated, and "a little awkward" since the home loan scandal broke and he resigned from the Cabinet.Reuse content