In this contribution, a variational diffuse modeling framework for cracks in heterogeneous media is presented. A static order parameter smoothly bridges the discontinuity at material interfaces, while an evolving phase-field captures the regularized crack. The key novelty is the combination of a strain energy split with a partial rank-I relaxation in the vicinity of the diffuse interface. The former is necessary to account for physically meaningful crack kinematics like crack closure, the latter ensures the mechanical jump conditions throughout the diffuse region. The model is verified by a convergence study, where a circular bi-material disc with and without a crack is subjected to radial loads. For the uncracked case, analytical solutions are taken as reference. In a second step, the model is applied to crack propagation, where a meaningful influence on crack branching is observed, that underlines the necessity of a reasonable homogenization scheme. The presented model is particularly relevant for the combination of any variational strain energy split in the fracture phase-field model with a diffuse modeling approach for material heterogeneities.