Can investing in a fund of SBA 7(a) loans qualify as an EB-5 investment?

It is clear from your fact pattern how this can work. You will need additional details, though, which should be spelled out in a business plan. You need well-detailed and adequate planning showing that the basic requirements can be met.

An experienced EB-5 immigration attorney will be able to advise you of acceptable EB-5 structures either as a Direct or Regional Center structure.

You would need to consult with an experienced immigration lawyer, preferably Board Certified in immigration law by his or her state bar, with significant experience in representing both EB-5 investors and job-creating entities under a Regional Center program. It would not appear that investing in a fund of SBA 7(a) loans would qualify. First of all, you have to establish that the investment funds went into a particular project that created, either directly or indirectly, at least 10 full-time jobs. Furthermore, almost all the projects were marketed at the lower $500,000 amount based upon being in a Targeted Economic Area (TEA) and you have to show that the particular funds were placed at risk in a particular project located within a TEA.

The fund model can work but you need to show how the funds are being used to specifically create the new jobs. It is advisable to avoid using a job bank.

I am not clear on how the investor will play an active role, at least a policy setting role, in how the investment will be utilized for job creation at these small businesses. The EB-5 investor must have a management or active role in the new business that he/she is investing in. Also, if you will loan money to several small businesses, will they all be within the same TEA, for example. I would advise you to work with experienced EB5 corporate and securities lawyers to check on viability.