Diminishing Partnership
مشاركة متناقصة
Pronunciation: moo-SHAH-rah-kah moo-tah-NAH-ki-sah
A co-ownership arrangement where the buyer gradually purchases the provider's share — the most common halal mortgage structure in the U.S.
Definition
See Musharakah Mutanaqisah. A co-ownership arrangement where one partner gradually buys out the other's share over time. The most common halal mortgage structure in the United States, used by Guidance Residential and UIF Corporation.
The buyer and financial institution co-purchase the property; the buyer's ownership percentage increases with each payment while the institution's share diminishes. Monthly payments typically include a portion that increases the buyer's equity and a rental payment for the institution's share.
Related Terms
Musharakah Mutanaqisahمشاركة متناقصة
Diminishing partnership — the most widely used halal mortgage structure in the United States.
Musharakahمشاركة
A joint partnership where all parties contribute capital and share profits and losses proportionally.
Ijaraإجارة
A lease or rental agreement — one of the three main halal home financing structures used in the U.S.
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Quick Answer
Diminishing Partnership (مشاركة متناقصة) — A co-ownership arrangement where the buyer gradually purchases the provider's share — the most common halal mortgage structure in the U.S. See Musharakah Mutanaqisah. A co-ownership arrangement where one partner gradually buys out the other's share over time.
Key Takeaways
- A co-ownership arrangement where the buyer gradually purchases the provider's share — the most common halal mortgage structure in the U.S.
- Category: Financing Structures
- Related: Musharakah Mutanaqisah, Musharakah, Ijara
- Compare related Shariah-compliant products on HalalWallet
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Reviewed by: HalalWallet Editorial Team
Last reviewed: 2026-03-06
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