business
The creditor's rights of the bank contribute. The creditor's rights of the bank will always come first. The creditor's rights contribution of the bank is conditional, that is, the project party is required to contribute 10-35%. The greater the project risk, the higher the investment ratio required by the bank, 20-35% or higher. If the project party does not have enough capital investment, it will use mezzanine loans to make up for its own investment. Real estate development projects with mezzanine loans are generally high-risk projects. Mezzanine loans rely on usury and other interests to reduce risks. For example, if they can't recover their investment in the short term, they will rely on 10-20% interest to reduce their risks.
Mezzanine loan projects generally belong to 500,000 green card projects. Under the current economic situation in the United States, it is very difficult to repay EB-5 mezzanine loans by selling and refinancing five years later.
Bridge loan is a short-term loan before obtaining a formal commercial loan, which is generally used for construction funds. But now in EB-5 industry, bridge loan is used to replace EB-5 as a mezzanine loan.
Because the Immigration Bureau has not applied for EB-5 project, the project party will first find an ordinary commercial loan to complete the project. This commercial loan is a bridging loan.