Can an EB-5 project use investment through partial financing? - EB5Investors.com

Can an EB-5 project use investment through partial financing?

If we have 50% cash in bank, is it ok to procure the other 50% required investment through bank loan?

Answers

Reza Rahbaran

Reza Rahbaran

Immigration Attorneys
Answered on

Yes, it can be through a bank loan as long as the loan is secured through your personal assets and not secured by the EB-5 project.

Lynne Feldman

Lynne Feldman

Immigration Attorneys
Answered on

As long as the money from the bank is not secured by the project itself but by your other assets then that is fine.

Jinhee Wilde

Jinhee Wilde

Immigration Attorneys
Answered on

Yes, as long as you are the borrower and responsible for repaying that loan.

Hendrik Pretorius

Hendrik Pretorius

Immigration Attorneys
Answered on

Loans as an EB-5 source of funds is a very fact specific issue as there are some loan types that are strictly prohibited. This should be discussed in more detail with an attorney.

Rachel Lew

Rachel Lew

Immigration Attorneys
Answered on

Yes, you can have cash infusions into a business, incurring debt on behalf of a business, securing loans for a business by risking your personal assets. To secure the bank loan, there should be some personal assets such as real property and promissory note executed stating the terms of repayment and the lender''s legal recourse if there is a default on your payment. Generally speaking, the loans should be paid in full before your removal of condition petition. In other words, you must show that your personal capital by way of cash and/or loan is at risk.

Boyd Campbell

Boyd Campbell

Immigration Attorneys
Answered on

Yes, as long as the bank loan is secured by your personal assets.

Stephen Berman

Stephen Berman

Immigration Attorneys
Answered on

No, it cannot be borrowed money.

Fredrick W Voigtmann

Fredrick W Voigtmann

Immigration Attorneys
Answered on

Maybe, but it will be difficult. Any additional financing cannot be secured by the assets of the new commercial enterprise. It must be secured by the investor''s personal assets and the collateral must be valued at fair market value.

Rohit Kapuria

Rohit Kapuria

Immigration Attorneys
Answered on

If I understand your question correctly, you are asking if EB-5 funds can be invested in a project in which the developer will also use bank financing. This scenario is certainly acceptable. The capital stack can certainly contain various financing sources. The key is to ensure that the developer also has some "skin in the game" as reflected through some equity investment.

BoBi Ahn

BoBi Ahn

Immigration Attorneys
Answered on

Yes. As long as the funds are clearly traceable as legally obtained (i.e., bank loans, salary, savings, etc), these funds can be used for EB-5 Investment. Hope the information helps.

Shahzad Q Qadri

Shahzad Q Qadri

RC Creators
Answered on

Yes provided that you secure the loan through some personal assets.

DISCLAIMER: the information found on this website is intended to be general information; it is not legal or financial advice. Specific legal or financial advice can only be given by a licensed professional with full knowledge of all the facts and circumstances of your particular situation. You should seek consultation with legal, immigration, and financial experts prior to participating in the EB-5 program. Posting a question on this website does not create an attorney-client relationship. All questions you post will be available to the public: do not include confidential information in your question.