If you are a foreign entrepreneur with enough capital to petition for an EB-5 visa, the chances are that you are now in the process of choosing the right project to invest in. 

But, while you might be impatient to get your application started and launch your business, this isn’t a decision to be taken lightly.

After all, the project you choose will influence your level of risk as an investor and immigrant, as well as the returns you are likely to see. Here are just a few factors to consider when carrying out your due diligence.

Finding an Investment Project That Will Make You Eligible for an EB-5 Visa: An Overview

The Employment-Based 5th preference (EB-5) visa is a great alternative for entrepreneurs who are able to invest at least $1,050,000 (or $800,000 for Targeted Employment Areas) in a new or existing business. 

Thanks to this Golden Visa, you can tap into the Land of Opportunity that America is today and grow your business in a fertile economy, while also working your way towards US citizenship. 

But it all starts with choosing the right project to invest in. Let’s start by understanding what an eb5 investments is and what options USCIS makes available to investors. 

Firstly, EB5 projects are commercial enterprises that aim to benefit the US economy and create at least 10 full-time jobs for qualified employees. 

The two main options for investors are:

• Investing in a regional center project – regional center projects are USCIS.designated entities that sponsor EB5 projects. Today, there are over 630 regional centers with hundreds of projects available. 
• Direct EB5 investments – investors looking to make a direct investment will direct their capital towards starting a new business or financing an existing venture. 

There are many differences between the two options. However, generally, regional center investments are a lower-risk, lower-return alternative that limits the investor’s control, making it perfect for EB5 investors looking for a hands-off approach. 

Oppositely, EB5 direct investments can lead to unlimited returns but might be riskier and more challenging to manage, especially as you’ll be directly responsible for creating and maintaining 10 full-time jobs.

Choose a Reputable Developer or Regional Center

No matter whether you prefer to make a direct or regional center investment, you should focus your due diligence on finding a transparent and trustworthy partner with an excellent track record. 

Many EB5 petitioners make the mistake of blindly investing in a regional center without reviewing the entity’s designation, finances, qualifications, fees, and communication style. But, according to USCIS, investing in a regional center does not automatically guarantee compliance with security laws or low investment risk. 

Beware of the telltale signs that your chosen regional center or developer is disorganized or inexperienced. For example, your partner should provide you with all the documentation you need to increase your project’s success chances at the beginning of your relationship.

What’s more, you should look out for the signs that an investment scam is underway. If your investment partner is making “no risk” claims or is unable to provide copies of the documents submitted to USCIS, they might be actors in an EB5 investor fraud. While the EB5 investor visa is highly regulated and has undergone several upgrades over the past years, scams are still popular.

Assess The Developer or Regional Center’s Rates of Success

It can be challenging for a foreign investor to make sure that a certain developer, investment partner, or regional center is experienced and trustworthy. While there are a range of factors that come into play, a good indicator of whether you should choose a certain project is a high rate of previous projects’ completion. 

To have a clear picture of what to expect, look at the rate of approval and denial of past “Immigration Petitions by Alien Entrepreneur” – or Form I-526. You should also look at whether the regional center you have chosen has been able to return the invested capital to its investors. 

Be Sure To Fulfill All Job Creation Requirements

One of the most important criteria that need to be fulfilled by EB5 investors is the job creation requirements. The EB5 visa – which is also known as the Job Creation visa – is established to leverage the capital and expertise of foreign entrepreneurs to create and maintain at least 10 new full-time jobs for eligible US employees. 

When working with a regional center, you won’t need to focus as much on this aspect, as you will be taking a hands-off approach and the USCIS-designated entity will be partly responsible for meeting the required criteria. 

However, if you are pursuing the direct investment path, you will need to understand what type of enterprise and what capital you’ll need to create and sustain 10 full-time jobs. For example, if your goal is to open a small, local cafe, you might not require ten employees, which can affect your ability to obtain a Green Card. 

Before investing, make sure to look at the project’s hiring plan, the number of jobs created so far, and other industry benchmarks.

Be Clear On What To Expect From Your Return on Investment

As seen above, investing in a regional center is often perceived as a low-risk option, but might curb your earnings. Oppositely, a direct investment does not pose any caps on how your capital gains. 

Ultimately, it all comes down to your risk tolerance. But, no matter which path you opt for, make sure to understand the industry you are investing in, choose a regional center that operates within thriving sectors, and be clear on what returns to expect. 

If you are struggling to find the right project, make sure to partner with an EB5 investment expert who can help you find the right investment for your risk tolerance and financial goals.

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