Bridge Financing Under the Proposed EB-5 Rule: Elimination Proposed, but DHS Left the Door Open

When the Department of Homeland Security’s proposed EB-5 rule landed under Docket USCIS-2026-0100, developers and regional center operators did not scan first for the investment amounts or the two-year clock. They went looking for one line in the job-creation section, and they found it: DHS proposes “Eliminating the use of repaid bridge financing as a basis to demonstrate job creation in the EB-5 program.” For anyone who capitalizes a project before EB-5 money arrives, that is the sentence that matters most.

But the proposal is not the flat prohibition it first appears to be. In the same section, DHS is soliciting comments on alternatives and tells the industry, in its own words, what a credible use of bridge financing looks like. That makes it one of the most productive provisions in the rule for a comment letter.

What Bridge Financing Actually Does in a Project

Bridge financing is ordinary in real estate and infrastructure development. A project rarely waits for a full slate of EB-5 investors to subscribe and clear source-of-funds review before it starts spending. Instead, the developer arranges interim capital, breaks ground, and later replaces that capital with EB-5 proceeds as investors come in. Under longstanding practice, jobs created while the bridge capital was working could be credited to the EB-5 investors whose money repaid it.

That practice is what DHS is targeting. The agency notes that “The RIA did not explicitly address the use of bridge financing in the EB-5 program,” so the current allowance rests on policy guidance rather than statute, and DHS now reads the 2022 statute as reason to revisit it.

What the Proposed Rule Would Eliminate

The operative text is short but sharp. Proposed 8 CFR 204.407(e)(1) would provide that “Jobs attributable to any financing repaid with EB-5 investment capital may not be claimed as jobs created by such EB-5 investment capital.” Put concretely, a job generated by the interim loan rather than by the EB-5 dollars that repaid it would not count toward an investor’s ten-job requirement.

The practical effect is timing. Jobs created before EB-5 capital is deployed become harder to claim, pushing the job-creation window later and compressing the runway projects have long relied on. Our EB-5 explainer covers how job creation anchors the petition.

The “By Creating” Nexus Amendment

DHS ties the change to a single-word amendment Congress made in 2022. The statute now requires that a new commercial enterprise “must benefit the United States economy “by” creating such employment,” a shift from the older “and create” phrasing. DHS reads that word as a call for a tighter link between capital and jobs, describing it as “a closer nexus between the alien’s investment into the new commercial enterprise and resulting jobs.”

The same idea drives a companion clarification, that “the jobs would not have been created but for the investment capital.” The changes push job creation toward a but-for standard: the investor’s money, not an earlier loan, must be the reason the jobs exist. Commentators have warned the but-for phrasing could reach past bridge financing into job attribution generally, one more reason this section is comment-letter territory.

The Door DHS Left Open

First-day readers often miss this: DHS does not treat elimination as settled. It writes that “DHS is also soliciting comments on alternative options to eliminating the use of bridge financing in recognition that there may be credible uses of bridge financing in the EB-5 program.” That is a candid concession that a categorical ban may be the wrong tool.

DHS then lays out a second path: rather than eliminate the practice, it could “restrict the use of bridge financing in the EB-5 program to sufficiently demonstrate a nexus between the jobs created by any bridge financing and the EB-5 capital used to repay the bridge financing,” for example by limiting maturity dates and the share of project costs bridge capital can cover. For operators, that option is far more workable than a ban, and DHS has invited the industry to make the case.

The Credibility Tell: Ground Broken, Permits in Hand

The most useful sentence here is not a rule at all. It signals how DHS thinks. The agency observes that “DHS has found that Form I-956F project applications filed after enactment of the RIA generally present more credible and realistic uses of bridge financing,” and gives a concrete example: “projects that have already broken ground and obtained permits to continue construction based on bridge financing are generally more credible.”

For a developer, that is close to a roadmap: a project that has secured entitlements, pulled permits, and started construction on interim capital is exactly what DHS says it trusts. Any comment should hold DHS to its own standard and ask it to preserve credit for jobs tied to permitted, under-construction projects rather than sweeping them out with the abuses the rule really targets.

Would This Reach Current Projects and Pending Petitions?

The question every current investor asks first. The rule’s general framework proposes prospective application: “DHS proposes that this rule be implemented prospectively to petitions and applications filed on or after its effective date,” subject to listed exceptions (91 FR 40689-90). The preamble’s stated default is prospective application to petitions filed on or after the effective date.

One honest caveat belongs in every comment letter: the proposed applicability text does not restate that prospective default provision-by-provision, and commenters should ask DHS to state expressly that any bridge financing change applies only to petitions filed after a final rule takes effect. Investors with pending petitions should review timing with their own counsel rather than assume either outcome.

This Is Prime Comment-Letter Material

The rule remains a proposal. Comments are due on or before August 31, 2026 (60 days after publication), under Docket USCIS-2026-0100, and this is a provision DHS has openly said it has not made up its mind about. A well-supported comment can point to DHS’s own credibility test, argue for the restriction option over outright elimination, and propose the maturity and concentration limits that separate genuine bridge financing from ten-year loans wearing a bridge label. DHS floats maturity limits in the 12-36 month range and a cap around 80 percent of project costs in its footnotes.

We are preparing formal comments on several provisions of the proposed rule, including this one, and will publish that analysis as the comment period runs. Developers and sponsors should consider filing their own comments too. For background, see our EB-5 explainer and our guide to the I-526E petition, and note that the separate September 30, 2026 grandfathering deadline runs on its own statutory clock regardless of how this rulemaking finishes. We will publish a dedicated walkthrough on filing an effective comment as the deadline approaches.

Related analysis in this NPRM series: redeployment under the proposed rule.

Important Disclosures

This article is provided for general educational purposes only and does not constitute legal, tax, investment, or immigration advice. Consult your own immigration and securities counsel about your individual circumstances.