Fannie Mae is the biggest player in the nation's secondary mortgage market. The CHFA is a state organization established to encourage the development, purchase and retention of affordable housing in the Golden State.

As part of the complex plan, Fannie Mae sold about $274 million worth of federally backed Section 236 mortgages to CHFA. By purchasing the loans, CHFA now has the opportunity to preserve the underlying apartment buildings for affordable rental housing.

The deal is aimed at stemming the growing number of apartment owners who are opting out of the federal subsidy program so they can raise rents to market levels. About 43,000 affordable apartment units in California alone could conceivably be removed from the federal rolls, Fannie Mae says.