UPDATE 1-Fed buys $1.7 bln in agencies, program 25 pct done

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NEW YORK, Jan 27 (Reuters) - The Federal Reserve bought $1.7 billion of Fannie Mae (FNM.P), Freddie Mac (FRE.P) and Federal Home Loan Bank notes on Tuesday, for a total of nearly $25 billion since the purchase program began in December.

The Fed has said it would buy up to $100 billion of these securities, as well as up to $500 billion of mortgage bonds issued by Fannie, Freddie and Ginnie Mae to help cut mortgage rates and revive U.S. housing.

With this purchase, the ninth since the program kicked off on Dec. 5, the Fed is a quarter of the way toward its agency note purchase goal.

The Fed has also said it stands ready to increase the amount of purchases if necessary.

Dealers submitted $3.395 billion for consideration in the latest Fed purchase, the New York Fed said on its website.

The Fed bought agency debt securities maturing from February 2011 through December 2012 in an outright coupon purchase, the bank said. (Reporting by Chris Reese and Lynn Adler; editing by Gary Crosse)