Read an EB-5 offering memorandum out of order. Go to the sources and uses table first, then the risk factors, then whatever the documents say about repayment, because those pages decide whether $800,000 of your capital comes back. The executive summary at the front was drafted by the people who wrote the brochure.
What comes in the package besides the PPM
A private placement memorandum runs to a few hundred pages with exhibits, and it describes a structure that other documents actually control. Where the two disagree, the agreements win, so ask for the whole set before signing anything.
- Limited partnership agreement or LLC operating agreement for the new commercial enterprise
- Subscription agreement and accredited investor questionnaire
- Escrow agreement, including the release conditions
- Loan agreement and security documents between the NCE and the job creating entity
- Economic impact report showing the job model and its inputs
- Business plan for the project
- Receipt notice for Form I-956F, the application for approval of an investment in a commercial enterprise
A sponsor who sends the PPM and withholds the loan agreement has told you something useful.
Sources and uses: make the arithmetic work
Add up the sources column. Add up the uses column. Say the EB-5 raise is $60 million of a $200 million project: your money goes in early and comes out last, and the rest of the stack has to close for the building to exist.
Hunt for the word "committed" beside every source. Committed money has a signed document behind it, usually acknowledged in a footnote that is easy to skip. Sources described as "anticipated" or "to be raised" are hopes with a font.
Land bought at a price paid to an affiliate of the developer deserves its own conversation.
Where your money sits in the capital stack
EB-5 capital is usually lent by the NCE to the job creating entity, and that loan usually sits behind a bank. Behind means paid second. Find the intercreditor agreement and read the standstill clause that stops the EB-5 lender from enforcing anything for a fixed period after a default.
Two numbers matter. Loan to cost tells you how much of the project runs on debt. The EB-5 slice as a share of total capitalization tells you how much equity cushion sits beneath you, and a developer contributing little of its own cash has less to lose than you do.
Some offerings put EB-5 money into equity rather than a loan. Different risk, different documents. In an equity deal "preferred return" carries no guarantee, and Pooled EB-5 Investments and Joint Ventures: NCE Structure and Job Splits explains how these structures divide jobs among investors.
Risk factors worth reading twice
Securities lawyers write risk factors to make later lawsuits harder, so they disclose genuine problems in flat, unenthusiastic prose. That makes the section the most honest part of the book. Skim past boilerplate about general economic conditions and stop on anything that names this deal:
- A construction contract not yet signed, or a guaranteed maximum price that is still an estimate
- Entitlements or permits described as pending
- A franchise or management agreement the operator can terminate
- Litigation, bankruptcy or regulatory action involving the principals
- A statement that the sponsor has never completed a project of this size
Compare those against the marketing deck. Anything the deck calls "guaranteed" and the memorandum calls "no assurance" is a documented contradiction, which is where EB-5 Red Flags 2026: 20 Warning Signs Before You Wire $800K starts.
Do the fees come out of your $800,000?
They should not. The full investment has to reach the new commercial enterprise and be made available to the job creating entity, so an administration fee is charged on top, commonly in the tens of thousands of dollars.
Find out where that fee goes. Much of it pays agents and finders, and since the 2022 statute those intermediaries must register with USCIS on Form I-956K, the registration for direct and third party promoters. Ask whether your agent has registered. Ask what the agent is paid, because a five figure commission buys a lot of enthusiasm.
Lawful source rules now reach those fees as well as the capital, so the money paying the administration fee needs its own documentation, as EB-5 Due Diligence 2026: Beginner Checklist to Avoid Bad Projects and Fraud sets out.
Redemption promises break the at risk rule
Search the documents for "redeem", "redemption", "put right" and "buyback".
Capital has to stay at risk. A guaranteed right to get your money back on a fixed date can sink the petition, and the requirement starts in 8 CFR 204.6, the regulation defining capital and investment for EB-5. A carefully drafted PPM states plainly that no investor holds any redemption right. When a sales agent promises otherwise over WhatsApp, believe the document.
Maturity dates, extensions and a delayed exit
Loan agreements carry a term, often five years, followed by a clause letting the borrower extend. Read that clause slowly. Two extensions of twelve months each, exercised at the borrower's sole option, quietly turn a five year deal into a seven year one.
Capital must be sustained for at least two years under current rules, and the immigration timeline runs longer than that for most investors. What you want is a maturity date that outlasts your Form I-829 to remove conditions. Where the exit depends on refinancing or selling the asset, the memorandum should say what happens if neither works out, which is the ground covered by EB-5 Project Failure 2026: Bankruptcy, I-829 Risk, and What Investors Can Still Save.
Count the job cushion yourself
Divide projected jobs by the number of investors. Ten jobs per investor is the statutory floor, so a model producing 10.2 has no room for a slow quarter of construction spending. Sponsors who underwrite to a real buffer usually advertise it.
Method matters as much as the total. Regional center projects may count indirect and induced jobs from an input output model, while a direct investment counts only full time employees of the enterprise, meaning at least 35 hours a week under 8 CFR 204.6(e). Combinations of part time positions do not count even when the hours add up, though two people sharing one full time position do.
Construction is the classic soft spot. Where the build runs less than two years, the model leans on jobs estimated from expenditures rather than workers on site, and the USCIS Policy Manual chapter on immigrant investors holds those standards. For the arithmetic itself, see EB-5 Job Creation Projections: Verifying the Economic Impact Report.
Who is on the other side of the table?
Regional center, NCE manager, developer, general contractor: sometimes those are four names for one family office. Affiliation is legal and extremely common. Undisclosed affiliation is neither.
Draw the org chart by hand. Then work out who signs the loan agreement on each side and who would sue the borrower if it stopped paying. Where the same person sits on both sides, the EB-5 lender never enforces anything.
No government agency vets the merits of these deals. Private placements are sold under exemptions from registration, and the SEC's own investor alert on claims that the SEC has approved an offering says so bluntly. Anyone implying official endorsement has already told you who they are.
Dates the offering has to outlive
The regional center program is authorized through 30 September 2027. Petitions filed on or before 30 September 2026 are covered by the grandfathering rule at 8 U.S.C. 1153(b)(5)(S), which lets them keep being processed even if authorization later lapses. An offering selling units well past those dates should explain how it handles the risk.
Investment minimums adjust for inflation for the first time on 1 January 2027, so a raise continuing past that date may sell two different subscription amounts to two groups of investors.
Last, confirm the sponsor has filed the I-956F for this offering. Filing is the gate. You may file Form I-526E, the petition for a regional center investor once the I-956F is on file, and USCIS has to approve the I-956F before your petition can be approved. Waiting for that approval before you file surrenders months of priority date for nothing.