The US Green Card through EB-5 Program: Issues for consideration

Category: USA
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The EB-5 visa program was launched in 1990 with the aim of attracting private foreign capital to the economy of the US and boosting job creation. Program participants have the opportunity to obtain a residence permit, and then the citizenship of the United States.

Since 2016, the lawmakers have been considering increasing the minimum amount of investment, but the conditions of the program will remain unchanged until September 2018. Foreign investors can obtain residence permit in exchange for an investment of minimum $500,000.

Of course, before applying to become a participant of the EB-5 visa program, you’d need extensive understanding of some tricky issues. Find the solutions to them below!

 

Regional centers are private companies, not state institutions. Which spheres do they operate in? What are the ways to check whether a regional center is eligible for attracting investment funds under the EB-5 program?

According to the terms of the program, a foreign investor is expected to invest $1 million in a new business project or an existing regional center project. The investment amount can be cut by half, to $500,000, if the project is located in a region with severe jobs shortage. As at the end of 2017, this amount still stands, but there is a possibility that the threshold of $500,000 may be raised to $800,000, and $1 million to $1.2 million, respectively.

Why invest in a regional center? Because it’s an easier and a more reliable route. In case of starting one’s own business, an investor is expected to create at least 10 new jobs, plus, it is rather difficult to predict how successful a business in the US will become. Regional centers make sure program conditions are fulfilled and provide all the documentation for the business project. This is the optimal option for those who are determined to immigrate to the States.

According to statistics, 9 out of 10 foreign investors choose the option of investing in a regional center.

The EB-5 program has gained particular popularity after the 2008 economic crisis. Increase in demand and a moderate system of state regulation contributed to the growing number of regional centers. In 2007, there were 11 regional centers officially operating in the US, and 866 in 2017.

Their spheres of operation are different, from IT startups to construction business, and the prevailing business category is actually construction of real estate objects. Developers were among the first entrepreneurs to appreciate the advantages of the EB-5 investor visa program. With its help, attracting money is more profitable than doing same through banks.

 

If the regional center I’ve selected has a valid license, does this guarantee the safety of my funds? The EB-5 program does allow for return of investment and income generation in certain cases.

If a regional center has a license, this does not necessarily mean that it has experience in working with the EB-5 program, and that the investment amount would be returned.

Therefore, it is of utmost importance that the investor chooses a trustworthy regional center and a promising business project.

Unfortunately, the statistics on the number of successful EB-5 business projects are not released to the general public. Moreover, it wouldn’t be easy to collect such data, since the reasons of failure can be varied; the applicant may personally withdraw the application, or the embassy may reject the candidacy of the investor, all of ​​which is unrelated to the activity of regional centers.

Of the 866 regional centers active today, just 7 to 10 will provide clients with a list of completed tasks and statistics on applications and return on investment. At the same time, the investor has the right to request relevant information.

Liability in every project can be insured in its own way. If one chooses to invest in construction projects, the constructed real estate objects will serve as the deposit.

 

Is there a possibility for the EB-5 program participants to buy back a hotel room or an apartment in a residential complex and keep the object after the construction is completed?

Yes, there is. Some regional centers offer opportunities like this. But the US Citizenship and Immigration Services (USCIS) may negatively assess participation in such business project, since, in this case, it would be difficult to prove the presence of risks – which is mandatory – because developers provide a guarantee of return on investment. Moreover, the participants cannot be sure that they would get their investment back after the expiration of the five-year period.

You see, if the developer commissions the commercial real estate object to a single buyer, they can immediately pay off all investors and banks. And in the case of selling apartments to individual buyers, the process of commissioning an object can be stretched out for a long time, hence, the investor will be getting their $500,000 back in installments until all apartments are sold.

 

How are investment funds transferred under the EB-5 program? What if the deposit is made but the USCIS does not issue a green card?

Most US regional centers use escrow accounts for transferring investment funds. The applicant is provided with full documentation on the business project, as well as the contract with the escrow holder. The amount transferred to the account is “frozen” until the applicant fulfills all terms of the contract with the regional center.

One of the conditions may be recruiting a certain number of investors to launch the selected business project, or approval of the I-526 petition (application for issuance of a conditional green card) by the USCIS for the first investor, or first ten investors, etc.

The rate of approved EB-5 program applications is 85%. This is the highest such indicator among all the options for business immigration into the US. Nevertheless, prior to submitting the application, it is recommended to check with the official representative of the regional center on what happens if the USCIS rejects the application, or the applicant decides to opt out of the program.

Interested in more detailed information about official and completely legal ways to obtain EB-5 Investor Visa? Contact us!

  • We offer free consultations, understanding how important it is for the client to make the only correct decision.
  • We work only in the field of investment immigration, integrating gained experience into the investor’s goal.
  • We work only with official immigration programs.
  • Before signing the contract, we inform our clients about all additional fees and expenses.
  • We conduct a screening to assess the investor’s chances of obtaining the desired citizenship.
  • We oversee the process at each stage and work exclusively towards the result.
  • We are in touch 24/7.
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