The issue is one we’ve covered before: A lot of underwater and struggling homeowners could benefit tremendously if they could refinance at today’s crazy-low rates. But they can’t refinance because the value of their property has dropped so much.

So now the Obama Administration has revised its Home Affordable Refinance Program (HARP), which was designed to help five million underwater homeowners but has only been used by half a million.

The changes are fairly simple, but they should enable many more struggling homeowners to cut their mortgage payments considerably — thus freeing money that could help the overall economy. For example, there had been a cap on the program: If you owed more than 125% of what the property was worth, you couldn’t refinance through HARP. That’s been removed. And a new appraisal isn’t required; a “reliable AVM (automated valuation model)” is enough.

As before, though, HARP refinancing is only available to borrowers who haven’t missed any payments in the past six months (or missed more than one in the past year), and whose mortgages are owned or guaranteed by Fannie Mae or Freddie Mac (and sold to them on or before May 31, 2009).

Click here for a Washington Post article that has more details, or click here for information from the Federal Housing Finance Agency.