Since its creation in 1990, the EB-5 Immigrant Investor Program has allowed thousands of foreign nationals to achieve their dreams of permanently immigrating to the United States. The program offers a unique opportunity for foreign nationals and their immediate family members to receive U.S. green cards in exchange for a qualifying investment in an EB-5 project. This is a wonderful opportunity for those hoping to relocate to the United States, but the program can be a bit complicated. To help those interested in the EB-5 program, here are some of the most frequently asked questions from potential EB-5 investors.
How much do I have to invest for an EB-5 visa?
To be eligible for an EB-5 visa, EB-5 investors must invest a minimum amount of $1.8 million into an EB-5 project of their choice. However, if the project is located in a target employment area (TEA), then the minimum investment required is halved, making it only $900,000.
A TEA is an area that would greatly benefit from new investment capital and the creation of new jobs. They are defined as high-unemployment TEAs and rural TEAs. High-unemployment TEAs are areas with an unemployment rate that is at least 50% higher than the national average, while a rural TEA is an area with a population less than 20,000. If an investor chooses to invest the lower required amount, they are required to prove on their I-526 petition that the project qualifies as a TEA. EB-5 investors also have the option of investing in a project through a regional center, which may make it easier to find a project in a TEA. Regional centers tend to focus on projects in TEAs because of the appealing lower investment requirement.
Can my EB-5 investment be funded with a loan?
There are multiple sources of funds that EB-5 investors can use for their investing capital, as long as the capital can be traced back to a lawful source. Loans are commonly secured by using the investor’s assets as collateral. In this case, the investor is required to document the lawful sources of their assets. Other common sources for EB-5 capital are salary earnings, money from retirement accounts, and donations from family members.
How risky are EB-5 investments?
The level of risk for each investment varies based on the individual EB-5 project along with other factors. It is required that all EB-5 investments remain “at risk” for the duration of the investment period, which means the investment must allow the possibility of loss and gain. However, this does not mean the investor has to make a risky investment. EB-5 investors should conduct thorough research on potential EB-5 projects, regional centers, and project developers to ensure the project has low financial and immigration risk. Investors should look for reputable regional centers and project developers that have a history of success with EB-5 projects. This can help ensure that they do not take on a higher level of risk than they are comfortable with.
When will my EB-5 investment capital be returned?
Because the EB-5 program requires your investment capital to be “at risk” during the investment period, the capital cannot be returned for at least two years. Certain projects may include stipulations that delay payment even longer, possibly up to five or more years. For this reason, EB-5 investors should make sure they have read through the entire agreement with the project and regional center and know what to expect from the repayment procedure. It is important that prospective investors are comfortable with their chosen project and the financial risks associated with it.
How does USCIS decide which EB-5 applications to prioritize?
Historically, United States Citizenship and Immigration Services (USCIS) processed EB-5 petitions in the order they were received. This was known as the first-in-first-out approach. This changed in April 2020 when USCIS adopted the new visa availability approach for processing applications.
Every country is allotted roughly 700 EB-5 visas for each fiscal year. Due to high demand, some countries are subject to a visa backlog, meaning there are more applicants than available visas. Because of this, the new processing approach prioritizes EB-5 applications from countries that have visas immediately available.
This new approach uses Chart B of the monthly Visa Bulletin to determine which countries do not have visas available. As of September 2020, China is the only country affected by this new approach due to the country’s larger-than-usual backlog.