As part of the financial bailout package that was announced November 25, the Federal Reserve has finally started buying illiquid mortgage assets to ease the struggling mortgage market and hopefully improve rates and credit terms for borrowers.

A number of different financial institutions hold illiquid mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac and Ginnie Mae, including banks and hedge funds, and are eligible for the program.

The Fed said late last year that it planned to complete its purchases of mortgage securities by June 30, significantly faster than most regulatory observers had initially expected.