Question. I have a gentleman that is purchasing an REO home with money from the city he resides in. The city is "acquiring"
his home via eminent domain. The city has offerred an addtional $55,000 for any work that needs to be done to the home in order to get the home up to code. The reclocation specalist involved suggested increasing the purchase price of the home my buyer wants to buy and use the funds out of escrow to make those repairs since the city isn't as "willing" as initally anticipated. 1)How would that get worded in a purchase agreement. and 2)Would a bank even accept those terms.
Thank you for any assistance.

"The city has offerred an addtional $55,000 for any work that needs to be done to the home in order to get the home up to code." Which home the REO???

In every eminent domain case I know of the city has an appraisal performed to determine fair market value.Then if the seller disagrees with that they can go to court arbitration. This is how it works in my state.

Cities will never offer extra money just the fair valuation of the property. Now it could be a developer is doing this project and has asked the city to eminent doamin a property the seller refuses to sell. If so the seller will get way more selling to the developer than the city will offer.

It sounds like some pieces are missing here in your post..

...sorry, trying to give out the readers digest version of my dilemma. The addtional monies offered $55,000 is for the home he wants to purchase.That home is a 1923 REO. He's getting $166,000 for his home and the addtional $55,000 is offered only if the repairs needed goes over the initial $166,000. And only if those repairs are required to get the home up to code. Those were the "initial" terms. Now the relocation rep is asking we "add" to the purchase price for repairs (for the home he is purchasing) so those repairs can be paid out of escrow instead. I'm sure things vary from state to state, we're in California.
Thanks super realtor!

Sounds like the RELO Company is trying to up their commission. I don't think the city will allow it.

Around here the additional monies are in the form an intrest free loan to the owner, and paid out on a draw system. The city inspects the work, and then pays the contractor directly. The owner never actually touches the money. The money is then paid back over time (or one program a portion of the debt is forgiven each year that they live there).

I've never heard of a city aquiring the propety via eminent domain. They will aquire them as nuciance properties, but then they are scheduled for a complete raze.