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How can I use borrowed money from a friend for my EB-5 investment?

A very good friend of mine who is a U.S. citizen is willing to give me an unconditional, unsecured, interest-free loan without the expectation of any gain to support my EB-5 application. Is this acceptable? What documents do I need to provide to prove the source of funds?

Answers

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    Ed Beshara

    Immigration Attorney
    Answered on

    Based on the facts you present, it is advisable for the friend to gift you the funds. On this basis, your friend would have to supply the lawful source of the funds gifted to you. Otherwise, based upon the current law, your friend can loan you the funds. However, the loan will be based upon your collateral assets and proof that you have the financial means to pay the loan.

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    Salvatore Picataggio

    Immigration Attorney
    Answered on

    They need to affirm, in writing, the nature of the gift. A lot more goes into the EB-5 fund tracking. so please consult with an experienced attorney.

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    Bernard P Wolfsdorf

    Immigration Attorney
    Answered on

    No, it must be gifted or based on a loan secured by your own assets.

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    Daniel A Zeft

    Immigration Attorney
    Answered on

    This sounds like a gift and not a loan. All U.S. and foreign gift taxes must be paid and documented.

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    BoBi Ahn

    Immigration Attorney
    Answered on

    Yes, that is acceptable source of funds. You should have a fully executed gift document/letter to document the gifting/transaction. The gift giver will have to provide documentation of the legal/lawful source of his/her funds as well.

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    Robert West

    Immigration Attorney
    Answered on

    No loan must be secured. A gift could work or a loan using a property or such with a value over the $500,000.

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    A Olusanjo Omoniyi

    Immigration Attorney
    Answered on

    Typically, a loan must be secured by the investor's property. The description you provided sounds like a gift and it won't qualify under the EB-5 source of funds for investment purposes. Advisably, consult an EB-5 attorney on how to best address this issue before you proceed further.

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    Irina Rostova

    Immigration Attorney
    Answered on

    Your friend's funds should ideally be documented with his U.S. tax returns and bank statements, showing the accumulation of the funds.

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    Dale Schwartz

    Immigration Attorney
    Answered on

    The immigration service says that it will not accept money that was borrowed unsecured. Best if you can secure the loan. At least one court has held that the immigration service is wrong about this, but that case is up on appeal.

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    Charles Foster

    Immigration Attorney
    Answered on

    You need traditional loan documents like a promissory note. It is much better practice for the note to be secured by property of equal value.

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    Belma Chinchoy

    Immigration Attorney
    Answered on

    It needs to be a gift. And to source it, your friend needs to provide documentary evidence of his income.

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    Hassan Elkhalil

    Immigration Attorney
    Answered on

    If the money is a gift, it may work. Consult with your immigration attorney for more details.

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    Marko Issever

    EB-5 Broker Dealer
    Answered on

    Unfortunately, this is not a valid source of funds, as you have presented your case. If your friend is willing to gift you the funds, then it should be OK as long as the funds he is gifting you can be sourced. He could also lend you the funds on a collateralized basis. USCIS would then want to source the way you obtained the collateral you are pledging to your friend. It is possible that, since your friend is not a lending institution, the funds, he would be lending you, need to be sourced as well.

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