By 
The EB-5 Immigrant Investor Program is regarded as one of the best visa-by-investment programs in the world. For over three decades, the EB-5 program has enabled thousands of foreign nationals to invest in U.S. businesses, and obtain green cards for themselves and their immediate family. The EB-5 industry also provides benefits to the U.S. economy through capital investment and the creation of jobs for U.S. workers.
The financial barriers to participating in the program are relatively low, compared to other visa-by-investment programs. Since the overturn of the Modernization Rule in June 2021, foreign nationals can make an EB-5 investment for $500,000 in a targeted employment area (TEA) project, or $1,000,000 in non-TEA projects. United States Citizenship and Immigration Services (USCIS) accepts any source of capital for the investment, including salary savings, loans, gifts, and capital from real-estate sales, provided the investor can prove it was legally sourced.
For interested foreign nationals who are unable to invest the minimum amount up front, USCIS allows the investor to make their investment in installments. In this article, we discuss the details of these partial investments, or installment investments, and how they work.
What Is a Partial EB-5 Investment?
In a partial investment, the EB-5 investor provides their funds in installments. The process typically involves an investment of a portion of the funds initially, with an agreement to provide the remainder of the capital within a fixed period.
As part of this agreement, the investor must sign a promissory note that includes pledged assets as collateral against the portion of the investment that is to be paid in installments. The assets must be worth at least as much as the pledged capital, and the EB-5 project will hold a lien on these assets. This means that the project can liquidate the assets to receive the promised capital if the investor does not pay the installments indicated in the promissory note.
Because the enforceable lien on the investor’s assets constitutes an irrevocable commitment of funds, USCIS deems partial investments to be permissible as an EB-5 investment. The partial investment is considered to be “actively in the process of being made,” as per the USCIS Policy Manual.
It is crucial for foreign nationals to provide detailed documentation about the terms of their installment investment in their I-526 petitions. USCIS will examine the evidence filed with this petition carefully to ensure that the promised funds will be delivered within the allowed timeframe. To fulfill the criteria of funds being irrevocably committed to the project, it is also essential for the investor to prove that the lien on their assets is legally enforceable by the EB-5 project.
Consider the case of a prospective investor looking to join the EB5 investment program, but who currently has access to only $400,000. To meet the investment threshold in a TEA project of $500,000, the foreign national would have to find an additional $100,000. The investor is confident they will have access to the required funds if they can invest in installments over the coming two years. Apart from their capital, the investor holds 100% equity of a liquid asset such as property. The property is worth more than $100,000, and this market value is confirmed by an independent report.
In this scenario, the investor can subscribe to their chosen TEA project with a partial investment. This would comprise $400,000 capital, and a promissory note for the remaining $100,000, which they will pay in installments. The property is pledged as security, on which the EB-5 project holds an enforceable lien. If the foreign national does not pay the installments according to the agreed schedule, the EB-5 project could liquidate the asset and receive the pledged funds.
The partial EB-5 investment route offers another way for foreign nationals to join the EB-5 industry. Prospective investors who do not have access to the minimum investment amount in capital may still be able to participate by investing in installments.
