Can You Use Loan Proceeds for EB‑5?

1 day ago

4 min read

iCross × ARCFE institutional real estate lending and EB-5 investment banner.

Yes. Investors can use lawfully obtained loan proceeds for EB-5, provided the loan is genuine, properly documented and used for a qualifying investment.

Borrowed funds can offer another funding option alongside personal savings, business income, property sales and family gifts.

For investors considering this approach, the key is understanding how USCIS reviews the loan, its source of funds, any applicable collateral and the transfer of capital into the EB-5 investment.

Concept illustration of loan documentation with a navy folder, calculator and pen beside a window overlooking New York.

Concept illustration: iCross × ARCFE.

1. How Does USCIS Treat Loan Proceeds for EB-5?

Under the EB-5 Reform and Integrity Act of 2022 (RIA), loaned funds may qualify as investment capital when they are provided in good faith and are not used to circumvent lawful-source requirements.

USCIS clarified in its policy guidance on loan proceeds that lawfully obtained loan proceeds invested as cash are treated as a cash contribution rather than a contribution of indebtedness.

This distinction matters because the rules governing a cash investment funded by borrowing differ from those governing indebtedness contributed directly as investment capital.

For investors, the practical focus is on the legitimacy of the financing arrangement, the lawful origin of the funds and the supporting transaction records. The investment must also meet the applicable at-risk requirements.

2. What Documents Are Needed for EB-5 Loan Proceeds?

The documentation depends on the lender, the loan structure and how the funds reach the investment. Common supporting records include:

Documentation	Typical Supporting Records
Loan Agreement	Signed agreement identifying the lender, borrower, loan amount and repayment terms.
Lender Information	Lender identification and, for non-bank lenders, applicable records supporting the lawful source of funds.
Collateral, if Applicable	Property ownership documents, valuations and relevant security agreements.
Transfer of Funds	Loan disbursement records, bank statements, wire confirmations and currency exchange records.
EB-5 Investment	Subscription and payment records showing the capital contribution to the New Commercial Enterprise (NCE).

Under the USCIS Form I-526E instructions, investors must identify the lender and provide applicable documentation demonstrating the lawful source of borrowed capital.

For loans from non-bank lenders, additional evidence of how the lender acquired the funds is required under the RIA’s source-of-funds provisions. Lawful-source documentation also applies to funds used for applicable EB-5 administrative costs and fees.

The records should reflect the actual transaction and be reviewed with qualified immigration counsel.

Planning an EB-5 Investment?

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3. Is Collateral Always Required?

Not necessarily.

USCIS treats lawfully obtained loan proceeds invested as cash differently from indebtedness contributed directly as investment capital. The requirement to secure contributed indebtedness with an investor’s assets therefore does not automatically apply to every cash investment funded by borrowing.

When a loan is secured by real estate or other assets, the relevant ownership and security documents can help establish the financing arrangement.

The important consideration is that the loan structure, lawful source of funds and supporting records meet the applicable EB-5 requirements.

For more on the broader documentation requirements, see ARCFE’s EB-5 Source of Funds Guide.

4. How Do Loan Proceeds Reach the EB-5 Investment?

Once the loan is disbursed, the funds may move from the lender to the investor’s account and then to the NCE.

Bank statements, wire confirmations and other transaction records help document that transfer history. International transactions may also involve currency conversion or transfers between financial institutions.

The objective is a clear record connecting the borrowed funds to the EB-5 investment.

ARCFE’s EB-5 Process Guide explains how investment funding fits into the broader application process.

It is also useful to distinguish an investor’s personal borrowing arrangement from financing provided to an EB-5 real estate development. Our article on Sources and Uses of Funds in EB-5 Projects explains the project-financing side.

For another common source of investment capital, see Can You Use Gift Funds for EB-5?.

The iCross × ARCFE Perspective

At iCross × ARCFE, we recognize that investors may use different financial arrangements to fund their EB-5 investments.

ARCFE was founded by iCross Capital, a real estate credit institution with nearly two decades of lending experience in New York City. This background informs our approach to evaluating real estate projects, financing structures and investment opportunities.

Our team provides clear information about ARCFE’s projects and investment process, while qualified immigration counsel addresses each investor’s source-of-funds documentation and filing requirements.

For investors considering loan-funded capital, clear financing records and coordinated planning can help support an organized EB-5 investment process.

This article is for general informational purposes only and does not constitute immigration, legal, tax or investment advice. Loan-funded investments must meet applicable EB-5 requirements, and individual documentation needs may vary. Investors should consult qualified professionals regarding their circumstances.

Recent ARCFE EB-5 Principal Repayment Highlights

Explore ARCFE’s latest EB-5 principal repayment milestones across pre-RIA and post-RIA projects. Click any image below to read the full project update.