In an EB-5 loan structure your money enters a new commercial enterprise that lends it on to the company actually building or running the project. In an equity structure the NCE buys an ownership position in that company instead, or operates the business itself. That single choice sets your place in the repayment line and, in practice, drives how likely you are to see the $800,000 come back.
Both structures can satisfy the immigration rules. Neither is safe by definition.
Follow the money: NCE, then JCE
Every Regional Center offering has at least two entities. You buy a limited partnership interest or an LLC membership interest in the new commercial enterprise, and the NCE is the entity your capital has to be at risk in. That NCE then deploys the pooled money into the job creating entity run by the developer. From that point your $800,000 is paying for concrete, equipment or wages inside a business you do not control and will probably never visit.
Your immigration file depends on the JCE spending money and hiring people. Your financial recovery depends on the terms agreed between the NCE and the JCE. Two separate questions, and they can end differently. A project can create 40 jobs per investor and still lose your principal, and that combination has happened.
Why so many offerings are named something like EB5 Lender LLC
Investors often find an entity in their documents whose name ends in the words EB5 Lender LLC, and go searching for it. That name is describing the structure. An entity christened as a lender exists to make one loan to one borrower, which tells you before you have read a page of the memorandum that this is a debt deal rather than an ownership deal.
Search the exact name in the state business registry where it was formed, then compare what turns up against the loan agreement in the offering package and against the borrower named in the private placement memorandum. Do the search. A lender entity with no loan agreement disclosed anywhere in the documents is a reason to stop.
Inside a typical EB-5 loan
Terms vary by sponsor, but the shape repeats. Pooled EB-5 capital goes to the JCE for a stated term, commonly five to seven years with extension options built in. That loan sits either as a senior mortgage or, far more often, as mezzanine debt tucked behind a bank construction loan that holds first claim on the building and on everything the building earns. Cash return to the investor is nominal, frequently a fraction of one percent a year, because what is being purchased is a green card.
Three questions are worth putting to any EB-5 loan.
- Who else lends to this borrower, and where does the EB-5 loan sit relative to them?
- What is the loan to cost ratio once every source of capital is counted?
- What happens at maturity if the project cannot refinance? Extension rights are common. So is silence.
Comfort in the loan model is contractual. There is a note with a maturity date, and often collateral behind it. Mezzanine collateral is usually a pledge of the borrower's equity interests in the project company, and a pledge like that is worth precisely nothing once the senior lender forecloses on the building itself.
Equity: common, preferred and what the difference buys
An equity NCE holds membership units in the JCE, or is itself the operating business. Preferred equity sits ahead of the developer's common equity in the distribution waterfall and normally carries a stated preferred return plus a redemption right at a target date. Common equity sits last. It gets paid only after every lender and every preferred holder has been made whole, which in a development that runs 30 percent over budget and then refinances two years late at a worse rate can easily mean it is never paid at all.
Read the distribution waterfall. All of it.
Upside in the equity model is theoretically unlimited. It is also theoretically zero, and in most EB-5 offerings the sponsor retains the majority of the economics, so the realistic outcome an investor should underwrite is return of capital. Underwrite that.
At risk means at risk, in either structure
USCIS will not credit an investment that carries a guaranteed return of capital. That requirement runs through 8 CFR Part 204 and through the long standing administrative decision in Matter of Izummi, which struck down redemption arrangements dressed up as investments. A guaranteed buyback will sink an otherwise clean petition. So will a put option the investor can exercise at will. Accept neither.
If a marketer tells you an offering is SEC approved, walk away. Regulators say so themselves in an investor alert on claims that the SEC has approved an offering.
Sustainment: two years, measured from the wire
Congress replaced the old open ended standard with a defined period in the EB-5 Reform and Integrity Act of 2022. Capital has to remain invested for at least two years. USCIS measures that window from the date the full qualifying amount was invested, so slow adjudication does not restart the clock. Its reading is spelled out in Policy Manual Volume 6, Part G.
What your documents say about repayment after that two year point is one of the few genuinely negotiable items in an EB-5 deal. Almost nobody negotiates it.
Entry price is identical whichever structure you pick: $800,000 in a Targeted Employment Area, $1,050,000 outside one, with both figures taking their first inflation adjustment on 1 January 2027. Regional Center authorization runs to 30 September 2027, while petitions filed on or before 30 September 2026 are grandfathered under 8 U.S.C. 1153(b)(5)(S) even if authorization later lapses. Diarize both dates.
Redeployment, the clause to read twice
Suppose the JCE repays the NCE early and your two year period has not finished. Your manager then has to put the money somewhere else. Redeployment language in most operating agreements grants broad discretion to move capital into a different asset, sometimes in a different state, sometimes for several more years. Investors sign that clause without reading it. Read it.
Job creation does not change with the structure
Ten full time jobs per investor is the requirement in a loan model and in an equity model alike. Structure is irrelevant here. Regional Center offerings count those jobs with an economic model driven by the JCE's construction spending and revenues, which is a large part of why the loan model became standard: expenditures are easy to document and easy to model. Direct investors count actual employees on payroll instead.
8 CFR 204.6(e) defines full time as at least 35 hours a week and refuses to let anyone add part time positions together to reach that. A genuine job sharing arrangement, where two employees split one full time position, does count as one job.
Reading the offering before you wire
Three documents carry the answers. A private placement memorandum describes risk. Your operating or partnership agreement controls what the manager may do with the money after it lands. Loan agreements and subscription documents set the real economics. A sponsor who will not send all three has answered your question already.
Check whether the project holds an approved exemplar, which we cover in our page on exemplar approval. Confirm the sponsor has filed Form I-956F for this offering, because you can lodge Form I-526E the moment it is filed rather than waiting for its approval. Then total up the fees sitting outside the $800,000, which we itemize in the real cost of EB-5.
Direct EB-5 asks a different question
Run your own business and the loan versus equity debate largely dissolves. You own the enterprise and your capital is equity by definition. Ten jobs come off your own payroll, which trades passivity for workload. Our comparison of Regional Center and direct EB-5 sets out where each route breaks down. Whether you may borrow the $800,000 in the first place is a separate matter entirely, handled in borrowing money for EB-5.