So there’s talk about the potential of a HARP 3.0 that would be available to even more distressed homeowners.

The Home Affordable Refinance Program (HARP) is a Obama-administration initiative (started in 2009) that allows homeowners who are current but underwater to refinance their loans at today’s crazy-low rates.

If you wanted to take advantage of HARP 1.0, you had to meet certain requirements:

  • The original loan must have been securitized by Fannie or Freddie, and before June 1, 2009.
  • You must have less than 20% equity in the home.
  • You must have paid your mortgage on time for the last six months.
  • The home must meet certain loan-to-value requirements.
  • You must show various proof of income/assets, and have a minimum FICO score

Almost a million homeowners took advantage of the original HARP.

In 2012 it was expanded in what came to be known as “HARP 2.0.” The big differences:

  • Loan-to-value requirements were waived.
  • You no longer have to show proof on income/assets, or have a minimum FICO score. (Which makes sense — if you’ve been current for six months, it’s obvious you can make the payment at a high rate, so you should be able to make it at a lower rate.)

And now comes a rumor of HARP 3.0, which will have a single significant change: Your loan won’t need to be backed by Fannie or Freddie.

Today, the GSEs back more than 90 percent of mortgages; it’s a good bet we wouldn’t have much of a housing economy without them. But back in the Long Long Ago — 2007, say — that wasn’t true. There are a lot of loans from back then without government backing, and at (relatively) high interest rates — 6.25%, 6.5%, or more.

A HARP 3.0 that applies to all mortgages would not only help those folks by cutting their payments significantly, it would put all that saved money back into the overall economy — the money could pay for food and toys and movies and cars (read: jobs) instead of interest.

Ah, but right now at least HARP 3.0 is just somewhere on the scale of plan-rumor-pipe dream. It may never happen. But it’s certainly worth keeping an eye on.