Diminishing Musharakah is a type of partnership where one partner gradually purchases the other partner's share. It can be used for house financing like purchase, construction, renovation, and balance transfers. The bank and client enter a Musharakah agreement where they jointly own the property based on their investment ratios. The bank's share is divided into units that the client promises to purchase at a pre-agreed price. An Ijarah agreement is signed where the bank rents its share to the client until the units are purchased. The rent covers the bank's profit and recovery of the principal amount. Units are purchased through offer and acceptance on a monthly basis.