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Questions & Answers

When can I return funds loaned for an EB-5 investment?

I have some real estate properties worth more than the EB-5 investment requirement, but cannot sell them immediately. Can I take a secured/unsecured loan for EB-5 from a friend? If I can sell my other property afterwards, what is the earliest I can return the loan without affecting my application?

Answers

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    Charles Foster

    Immigration Attorney
    Answered on

    As of this time, you may take a secured loan for the purposes of acquiring the funds to make an EB-5 investment. However, you should consult experienced immigration counsel.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    A loan must be secured by your personal assets and properly documented. Personal assets must be appraised to obtain a fair market value. Under proposed legislation, there will be stricter requirements for loan proceeds to be used for EB-5 investment, which will have to be from an accredited lending institution rather than a person/friend.

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    John J Downey

    Immigration Attorney
    Answered on

    You may use proceeds from a loan for EB-5 purposes as long as you a personally responsible and the collateral consists of your assets. The time of payback on the loan should not affect your EB-5 application.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    Loans can be used as a valid source of funds for EB-5 investments, but they must be properly secured and documented, and the collateral must be valued at fair market value. The assets of the new commercial enterprise may not be used to secure the loan. It might not be easy to establish to USCIS' satisfaction that the loan from your friend is sufficiently secured and properly documented. A loan (e.g., home equity line of credit) from a financial institution would be a better source of funds. There is no restriction on when you pay back the loan, nor is there any effect on your EB-5 case should you choose to pay the loan back early.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    Under current regulations and policy, loans must be secured by personal assets in order to be lawfully used as a source of investment funds. Authenticating your source of funds and planning for things such as return of funds is best done with the assistance of an EB-5 attorney.

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    Jack C Sung

    Immigration Attorney
    Answered on

    A loan from a friend that is backed by property as collateral is permitted as EB-5 funds as long as it satisfies the source of funds requirement. When you pay off the loan is not part of the scope of EB-5 because it is not being paid back from the regional center.

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    The issue here is exit strategy. How soon you can divest your investment depends on the terms governing the exit, which vary from one regional center to regional center. Even with the same regional center, the exit strategy may vary depending on a project by project basis. Usually, investment funds may remain invested for as much as 5-7 years before you can exit. Advisably, if you have not signed an agreement, consult an EB-5 attorney for better guidance.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    USCIS has been requiring the secured loan to be from an institution rather than a person as they are tightening the requirements for tracking legal source of funds. As long as the EB-5 investment is in place and continuing, there is no limitation on how quickly you repay the loan from which you obtained the EB-5 investment.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    All loans must be secured by the investor's personal property, and if you are going to attempt to comply with recently proposed changes, you might want to make sure this loan is from an accredited lending institution.

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    Vaughan de Kirby

    Immigration Attorney
    Answered on

    You can use funds obtained from a loan secured by your property. Note that under proposed legislation the loan must come from a qualified banking institution.

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    Stephen Berman

    Immigration Attorney
    Answered on

    No, you cannot get an EB-5 visa based on borrowed money. You must own the money.

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