Most discussion around the EB-5 focuses on the amount of money you need to invest in order to qualify for the visa; what a lot of people do not realize, and what a lot of regional centers aren’t as quick to share, is that the total cost of your visa is not just a flat $500,000 or $1 million. The total cost will be higher when all is said and done.
In addition to the requisite amount of your investment as determined by the USCIS and the project you are investing in, there will be an additional set of fees charged by the regional center. This varies between each center, and is set by the administrators; these fees are in no way regulated by the U.S. government, and are entirely separate from your investment. As a bare minimum, you are probably looking at something more in line with $540,000 just to get started on the process and investing. This figure is arrived at by taking the minimum amount of $500,000 required by USCIS, and adding in the average basic fee of $40,000 that the regional center will charge in administrative and other fees.
Many of these fees are real reflections of costs of business and investment, and are justifiable. They may be used for a variety of applications, including administrative fees and legal fees accumulated by the regional center in the course of processing and overseeing the project. It is not that it is shady business for a regional center to charge a set of additional fees, and in fact this is the norm; the trouble comes when investors are not prepared for them, because they have only been given the bare basics of investment requirements.
The other problem that often arises is that investors are not told specifically what is and is not covered by the fees that are disclosed to them. For instance, the legal fees charged are the fees incurred by the regional center for legal services—they are completely separate from the legal fees that you will incur for your own representation. It is also not uncommon for an investor to be lead to believe or assume that the fees they are charged will cover all of their expenses with USCIS for application and petition fees, but this also is something separate that you need to be prepared for.
A true determination of the potential cost of doing business with a given regional center really only comes through a thorough analysis of the center’s costs and charges. You need to know exactly what is and is not included in any fee structures, but then you also need to go beyond that published list and ask the questions the centers are hoping you would not think about (at least not until it is too late and they’ve already got you on the hook for $500,000 to$1 million!). Most of these, like project evaluation itself, are not questions that you would know to ask unless you have had extensive dealings with a number of regional centers, policies, and projects. Potentially, any small variation from the “normal” application (which is usually to say, very basic and “by-the-book”, if such a thing exists) is grounds for additional charges and processing fees from the center. There are myriad potential charges that should be discussed well ahead of any commitments or payments.
Both the published and the hidden costs and fees of a regional center need to be determined before you can make a real, informed choice of a regional center investment project. Only when you know the real cost potentials will you know the real cost of doing business with the centers you are considering. And only when you know all the costs of all the centers on your list do you have a real basis for comparison between centers and projects. This is an overwhelming amount of information for one person to pursue and flesh out, but with the help of an experienced immigration consultant the information will be much more quickly forthcoming and provided in a way that makes comparisons easier, giving you the confidence to make a good decision.
Next we’ll look at potential problems and red flags associated with an EB-5 investment visa. In the meantime, if we can answer any of your questions please contact Stephen Parnell or Andrew Bartlett at Which EB5Google+