You are hereFrequently Asked Questions / EB-5 Law & Related U.S. Law / [Q] Can I invest $500,000 in a rural area for a direct, individual EB-5 case where 60% is from a bank loan?

[Q] Can I invest $500,000 in a rural area for a direct, individual EB-5 case where 60% is from a bank loan?


[Q] I am planning on doing a direct, individual EB-5 case based on a lowered $500,000 investment in a rural area, i.e. TEA qualification. I am planning on investing $200,000 of my own money and coming up with the remaining $300,000 from a collateralized bank loan. Is this permissible?

It all depends on which asset is used to collateralize the loan of $300,000 from the bank. If the underlying EB-5 investment asset was used as a collateral to obtain a loan of $300,000, then forget it -- you can't do it. But if your own personal asset, such as your house, was used as a collateral to obtain additional $300,000, then that would be fine.

Rationale: The definition of permissible "capital is defined in such a way to exclude any loans obtained using the underlying EB-5 business as a loan collateral or security.