EB5 Visa Updates: New Bill Introduced + Unsecured Loans

EB5 Visa Updates: New Bill Introduced + Unsecured Loans

EB5 Reform and Integrity Act of 2021 + Unsecured Loans for EB5 Visa


In this article, we have two separate updates to share with you regarding the EB5 investor visa program.  The first update is regarding a bipartisan bill that was introduced to improve the EB5 visa program and to reauthorize the regional center program.  The second update has to do with a court case that was decided in 2020, which may have some exciting implications about potentially using unsecured loans as the basis for an EB5 investment.


If you have any questions feel free to call or text us at +1-818-741-1117 or you may request a free consultation by clicking this link.


An Overview of the EB5 Visa


To start off, it would be helpful to provide a brief overview on what the EB5 visa is, and how it works.  The EB5 visa is an “investor visa.”  Through the EB5 visa, someone can invest in a United States business and, based on that investment, they can potentially qualify for a green card.


There are various requirements to get approved for EB5 visa.  The investor has to invest the requirement minimum investment amount to qualify for EB5. At the time of this articles publication, the required minimum investment amount is $500,000.  In addition to making that monetary investment, the investor’s investment must lead to the creation of 10 full-time jobs for U.S. workers. There are additional requirements as well, for example, the investment  funds must come from a lawful source.  Again, if these various requirements are met, then you can potentially qualify for a green card for yourself, your spouse, and your unmarried children under 21 years of age. 


Overall, it's a wonderful option for those who are interested in pursuing a green card based on investment. With that general overview, lets discuss some updates to the EB5 program.


Update 1: The New “EB5 Reform and Integrity Act of 2021”


Senators Chuck Grassley and Patrick Leahy have introduced a new bill called the “EB5 Reform and Integrity Act of 2021.”  The goal of the bill is to improve the EB5 program, and to reauthorize the “regional center” program until 2026.  Let’s delve into the details of the new bill. 


If somebody is considering making an EB5 investment, he or she has two options.  The person can either (i) make a direct investment or (ii) invest in a “regional center project.”  A direct investment is what you would think a basic investment in a business looks like - putting money into a business with a hope of some return based on the success of the business.  A regional center investment, by contrast, is when somebody invests in an regional center, which is an business entity that is designated by USCIS.  The “regional center” projects are usually large-scale developments such as hotels, resorts, sports arenas, etc. 


If somebody chooses to invest in a regional center project, then there are various advantages.  For example, the way that USCIS calculates the total number of jobs that are created by the regional center project is more favorable compared to somebody who is making a direct investment.  Additionally, EB5 regional centers have the power to get something called an “exemplar approval.”  An “exemplar” is basically a sample petition that is filed with USCIS that, if approved, is almost as if USCIS is giving its stamp of approval regarding the business components of the particular project.  EB5 regional center projects are typically managed by their own management group, so the individual investor doesn't have much involvement in the day-to-day operations of the business.  As you can see, regional center investments can be advantageous for the right candidate. 


However, there are two big issues with regional center projects to keep in mind.  The first big issue is that the regional center program is a pilot program, meaning that it is not a permanent fixture of the EB5 program.  The regional center program is essentially a temporary program that has continued to be extended over the years.  As of right now, the regional center program has lapsed as of June 30th, 2021.


The second big issue is that, over the years, there have been multiple instances of fraudulent projects that have taken funds from unknowing investors and misappropriated those funds, causing the investors to lose money.


The new “EB5 Reform and Integrity Act of 2021” fortunately seeks to fix those issues.  First and foremost, this bill seeks to extend the program through 2026, which deals with the first big issue currently plaguing the EB5 program.   With regard to the second issue, protecting against fraud and abuse, the bill will require that the regional centers that are responsible for overseeing EB5 projects have policies and procedures in place to protect against fraud. 


Specifically, the bill requires that regional centers file proposed EB5 project business plans with the Department of Homeland Security (DHS).  It also requires the following:


  • More disclosures to investors with regard to the material business risks and conflicts of interest in EB5 projects,
  • Regional centers must notify DHS of significant changes to their structure,
  • DHS must audit regional centers every five years,   
  • DHS must perform site visits to EB5 projects,
  • Regional centers must provide annual statements to DHS and to their investors, accounting for the investor capital in certifying compliance with program requirements,
  • Background checks of the regional center must be conducted for certain project principals, and  
  • Regional center principals responsible for overseeing the foreign investors participation in the visa program must be U.S. citizens or lawful permanent residents.


Those are only a few of the many provisions to the bill, which is full of many positive improvements and changes to the EB5 regional center program. 


It is important to note that this bill not yet passed before the House or the Senate.  For this bill to become law, it would have to pass before the House and Senate.  Ashoori Law will monitor the progress of the bill to see what happens with the bill going forward.

EB5 Visa Updates: New Bill Introduced + Unsecured Loans
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Update 2:  Using Unsecured Loans as the Basis for Your EB-5 Investment


The EB-5 visa has a “lawful source of funds” requirement, in that it is very important to document that your investment funds came from a lawful source.  There are many types of sources of funds that can qualify for the EB-5 program.  For example, funds saved through employment earnings, proceeds from the sale of property, or a gift of money from a friend or family member are all potentially valid sources of funds. 


With regard to loans as a valid source of funds, the EB-5 program has traditionally required a secured loan. Specifically, the loan had to be secured by the EB-5 investor’s personal assets and could not be secured by the EB-5 investor’s EB-5 business assets - to be eligible as a valid source of funds.  Traditionally, unsecured loans would not be permitted. 


In October 2020, however, a court case was decided that appears to make it clear that unsecured loans can now qualify as the basis for an EB-5 visa.  It is important to note that this court case is relatively new.  So, there is not a whole lot of data on how USCIS is ruling on cases where investors are relying on unsecured loans.


Because of the lack of data on how USCIS is ruling on EB-5 petitions where unsecured loans are being used, it still may be preferable if you have other sources of funds to choose from, to use those lawful sources of funds rather than using unsecured loans, until we see more data on how USCIS adjudicates cases with unsecured loans as the basis of the investment.




The main takeaways from this article are that (i) there is a new proposed bill working its way through Congress that seeks to extend the EB-5 regional center program, and protect the program from fraud and abuse; and (ii) it may now be possible to use unsecured loans as a source of investment for an EB-5 visa.  


My name is Michael Ashoori and I'm a U.S. immigration lawyer and the founder of Ashoori Law. As an immigration lawyer, I help families, professionals, investors, and entrepreneurs get visas, green cards, and citizenship to the United States.  If you have any questions, feel free to request a free consultation by clicking this link

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Michael Ashoori, Esq.

U.S. Immigration Lawyer

I’m a U.S. immigration lawyer and I help families, professionals, investors, and entrepreneurs get visas, green cards, and citizenship to the United States.

Since starting my law firm, I’ve helped hundreds of people from all over the world with their immigration needs. I’m very passionate, hard-working, and committed to my clients.

Got a question? Send me an email.