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Answers to 10 Frequently Asked Questions About the EB-5 Program

Answers-to-10-Frequently-Asked-Questions-About-the-EB-5-Program
Participating in the EB-5 Immigrant Investor Program can be one of the most exciting pathways a foreign national can take to permanent residency in the United States. While it is arguably one of the easiest ways for qualified investors to secure U.S. green cards for themselves and their eligible family members, there are a lot of moving parts to this program and its processes. More moving parts invariably give rise to more questions, and that makes sense. Below are answers to 10 of the most frequently fielded questions from potential investors evaluating whether an EB-5 investment is right for them.

Question 1: What’s an EB-5 Visa?

Answer: The EB-5 visa is one of a set of five employment-based immigrant visas. “Visa” is another word for “green card.” In simplest terms, this program is known as a residency-by-investment option. Classification from the top down looks like this: In the United States, green cards are first categorized by immigrant and non-immigrant status. Then, under the immigrant category, there currently exist four types of immigrant green cards. One subcategory is the employment-based visa. There are five different employment-based visa programs, and the EB-5 Immigrant Investment Program is one of them.

Question 2: Is an EB-5 Visa an Option for Me?

Answer: An EB-5 applicant is considered an individual investor, and this program is open to all foreign nationals who have the fiscal means to invest the minimum amount required into a program-approved EB-5 investment project. Because it is one of the quickest paths to U.S. permanent residency and eligible family members – spouses and dependent children – may apply under a single investment, it is often a primary choice for families with access to investment capital.

Question 3: How Can I Get an EB-5 Visa?

Answer: Although the EB-5 process can be time-consuming and a bit more complex under the surface, the basic requirements for securing an EB-5 visa through this program are fairly straightforward and can be counted on one hand:

Question 4: Should I Invest Directly or through an EB-5 Regional Center?

Answer: The answer to this question truly depends upon how involved you’d like to be in the day-to-day operations of your selected project. While the EB-5 regional center program has not been written into U.S. immigration law yet, by far, it is the more popular option among foreign nationals because there are a number of key advantages to investing your EB-5 capital into a regional center.

Generally speaking, working with an experienced regional team is less risky. There is a higher likelihood for locking in on a TEA project that requires half the EB-5 investment amount. How a regional center can meet the job creation requirement also differs – it is more relaxed. And you don’t need to be close enough to the project site to manage daily tasks, unlike with most direct investment projects.

Question 5: How Does Job Creation Differ for Regional Centers?

Answer: The above answer describes the job creation requirement for regional centers as “more relaxed.” EB-5 investors weighing their options may wonder exactly what that means. Whereas a direct investor may only attribute jobs that were added to the project’s direct payroll toward the 10-job minimum requirement, regional centers are allowed greater flexibility in calculating job creation. Indirect and induced jobs may be attributed as long as a reasonable methodology is used to establish job creation.

Reasonable methodologies normally approved by USCIS encompass input–output models that the U.S. government and other reputable entities have used. The methods accepted involve a mathematical estimation for the jobs created and other factors of economic stimuli that can impact a particular sector of an economy (including capital investment).

Question 6: Why Would I Prefer a Direct EB-5 Investment?

Answer: Sometimes a direct EB-5 investment is the ideal option for a foreign national investor. If you have extensive managerial expertise, for instance, and want to continue building your resume, or if you prefer to retain more control over your EB5 investment funds, a direct investment would be a way to ensure these goals are met. Another scenario would be when you already run a business in your country of origin and wish to expand into the U.S. market. There are direct EB-5 investment strategies that may make more sense than working through a regional center.

In either case, it is advisable to reach out to an experienced immigration attorney to determine whether a direct investment is the best way to reach your business goals considering your unique circumstances.

Question 7: Will I Get My EB-5 Investment Capital Back?

Answer: One of the primary requirements for participation in the EB-5 program is that EB5 investment capital must remain “at risk” for the duration of the investment period. While the name of the requirement alludes to investing in risky projects, this is not the case. The central goal of the EB-5 investment program is to strengthen the economy. How do you do that with an investment? By successfully growing the original amount invested.

The actual purpose of the EB-5 “at risk” requirement is to ensure EB5 investment capital is specifically used to fund a new commercial enterprise (NCE) that will create real jobs and stimulate the economy. Ensuring your funds remain “at risk” refers to both the risk of financial loss and the opportunity for financial gain. The specific terms of your investment will be unique and should be clearly outlined in your investment documents – including how you will see your capital (and any gains) returned.

Question 8: How Long Will It Take for Me to Get an EB-5 Visa?

Answer: Hopeful EB-5 investors have heard this program is one of the shortest paths to U.S. permanent residency, but that doesn’t really answer this question, does it? This is because the time it takes to complete the EB-5 process depends on a plethora of variables, including but not limited to:

What is certain are the eight steps each investor will pass through on their journey to an EB-5 visa. Learn more about those steps here.

Question 9: Why Do I Have to Wait for My EB-5 Visa After I’ve Been Approved?

Answer: Immigration to the United States is based on a quota system, and there are limits to the number of visas allocated each fiscal year. For the EB-5 program, for instance, approximately 10,000 visas are made available to foreign national investors. However, those visas are further split relatively evenly among participating countries. If demand exceeds supply in a certain country, as with anything, a backlog can manifest. This is why you may be required to endure an additional wait even beyond EB-5 visa approval.

Part of the reason the EB-5 program is so popular is that the backlog for the EB-5 category is relatively recent compared to other green card categories with long-standing backlogs. A bit of recent history: Indian nationals experienced a visa backlog for the first time in July 2019, but after a year of erratic priority date shifts, the India EB-5 backlog became current again (in July 2020) with no additional delays expected. Only two countries are dealing with backlogs as of November 2020 (China and Vietnam).

Question 10: Should I Be Concerned If My Country Is Backlogged?

Answer: If you’re an EB-5 applicant from a country experiencing visa backlogs, there will be an extended wait before obtaining your EB-5 visa after your I-526 petition is approved. Your wait will generally be determined by the number of visa applicants ahead of you in the visa queue. This may become a concern if you are including family members because minor children don’t stop aging while their parent-investor stands in line, so to speak, and children aged 21 and older are ineligible to receive a U.S. green card as the dependent child of an EB-5 investor.

For this reason, in-depth planning with experienced immigration advisors is essential ahead of the decision to participate in the EB-5 investment program. There are strategies an investor can employ (including naming the minor child as a primary EB-5 applicant) during the early stages of investment when aging out could become a concern.

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