What is Musharakah?
Musharakah, or diminishing partnership, is the most widely used halal mortgage structure in the United States. You and the lender jointly purchase the property, and you gradually buy out the lender's share.
How It Works
You make a down payment (typically 20%), and the lender covers the rest. Each month, you pay rent on the lender's portion plus a payment to buy out their share. Over time, you become the sole owner.
Advantages
- Most common structure in U.S.
- Flexible payment options
- Shared risk with lender
- Gradual ownership transfer