Planning a Nantucket purchase or sale? If you have been running numbers, the Nantucket Land Bank fee can raise questions about how much you will bring to or take from the closing table. You want clarity before you write an offer or accept one. This guide explains what the fee does, when it applies, who typically pays it, how exemptions work, and how to plan your closing costs with confidence. Let’s dive in.
What the Land Bank fee is
The Nantucket Land Bank fee is a local transfer fee collected on certain real estate transfers to fund land conservation, open space protection, and community projects on the island. The fee is administered by the Nantucket Land Bank and is collected through the real estate closing and recording process. Payment is usually handled at the time the deed is recorded, with a Land Bank certification or form included in the recording package.
Rules can change over time. Always verify the current fee rate, qualifying transfers, exemptions, and filing procedures with the Nantucket Land Bank, the Nantucket County Registry of Deeds, or your closing attorney before finalizing numbers.
How the fee shows up in a transaction
The fee is generally triggered when title to property transfers and the deed is recorded. It is tied to the transfer itself, not to your financing. At closing, the settlement agent or closing attorney typically collects the fee and remits it to the Land Bank per required procedures. Lenders expect all closing obligations to be satisfied, so the fee appears on the settlement statement like other closing charges and must be paid before recording.
Plan your cash flows early. If you are the buyer, you may need to bring the fee amount to closing unless your lender allows it to be financed. If you are the seller and agree to pay the fee, factor it into your expected net proceeds.
Who pays on Nantucket
Who pays is negotiable. While statutes and local rules may specify responsibility in some cases, the practical reality is that buyers and sellers often negotiate who covers the fee. On Nantucket, common approaches include the buyer paying, the seller paying, or splitting the cost. You can also address the fee through price and credits, such as a price reduction if the buyer agrees to pay the fee.
For clarity, include the Land Bank fee as a line item in your offer and in the purchase and sale agreement. Make sure the settlement statement will show the fee and the responsible party.
Exemptions and special cases
Some transfers may be exempt, but exemptions are fact specific and require documentation. Common exemption categories used by many land banks include:
- Transfers between co-owners or changes in ownership form where no true sale occurs, such as transfers between spouses or transfers to and from revocable trusts for estate planning.
- Transfers pursuant to divorce settlements, probate, or by executors and administrators.
- Transfers to government entities.
- Certain conservation conveyances, including where the Land Bank itself is a grantee.
- Ministerial corrections or mergers that do not change beneficial ownership.
- Mortgage refinances, which typically do not involve a title transfer.
To claim an exemption, you usually file a signed exemption certification at closing and provide supporting documents, such as a divorce decree or trust instrument. If an exemption is misclaimed, the transferee can still be liable for the fee and potential interest or penalties, so accuracy matters.
Plan your numbers with simple examples
Fee rates and thresholds can change. The examples below use a hypothetical 2 percent fee for illustration only. Verify the current Nantucket rate before you rely on any numbers.
Example A — Buyer pays fee:
- Purchase price: 2,000,000 dollars
- Land Bank fee at 2 percent: 40,000 dollars paid by buyer at closing
- Seller’s net proceeds are not reduced by the fee
Example B — Seller pays fee:
- Purchase price: 2,000,000 dollars
- Land Bank fee at 2 percent: 40,000 dollars paid by seller at closing
- Seller’s net proceeds are reduced by 40,000 dollars plus other closing costs
Example C — Adjust price to reflect who pays:
- If a seller wants to net about 1,960,000 dollars after a 2 percent fee, a buyer could offer 2,000,000 dollars and pay the fee, or offer 1,960,000 dollars and ask the seller to pay the fee. Spell out who pays in the contract to avoid surprises.
Discuss with your lender early if you hope to finance the fee rather than pay it from cash at closing. Policies vary.
Negotiate the fee in your offer
Use the Land Bank fee to help structure a deal that works for both sides:
- Make payment responsibilities explicit in the purchase and sale agreement, including who will provide any exemption documentation.
- Consider a price adjustment or seller credit if one party agrees to cover the fee.
- In tight markets, buyers who agree to pay or split the fee may strengthen their offer. In a slower market, sellers may prefer to cover the fee to attract buyers.
- Review tax and mortgage implications with your lender and tax professional before you finalize terms.
Due diligence checklist
Work through these checkpoints to keep your closing smooth and predictable:
Before making or accepting an offer
- Verify the current Land Bank fee rate and any scheduled changes.
- Ask about prior transfers and whether any exemptions applied.
- Confirm with your lender if the fee can be financed or must be paid in cash.
At the contract stage
- Specify who pays the fee and who is responsible for any exemption filings.
- Require that the settlement statement list the Land Bank fee clearly.
With the closing or title attorney
- Confirm the correct Land Bank form or certification that must be recorded with the deed.
- Ensure the closing agent will remit the funds and provide proof of payment and recording.
- If claiming an exemption, prepare all supporting documents and confirm the filing timeline.
After closing
- Keep copies of the recorded deed and any Land Bank certification for your records.
- If an exemption is later questioned, contact your attorney promptly.
Why this matters for Nantucket buyers and sellers
The Land Bank fee supports the island’s open spaces and is a standard part of Nantucket closings. For you, the key is clarity. When you decide who pays, confirm any exemptions, and plan the cash flow early, you reduce friction at closing and protect your bottom line. That is especially important with high-value coastal and second-home properties where small percentage changes can mean large dollar amounts.
If you want a clear, numbers-first plan for your transaction, we can help you model scenarios, align contract language, and coordinate with your lender and closing attorney. Connect with The Carroll Company to talk through your goals and request your instant home valuation today.
FAQs
What is the Nantucket Land Bank fee and why is it charged?
- It is a local fee collected on certain property transfers to fund land conservation, open space protection, and related community projects on Nantucket.
When is the Land Bank fee paid during a Nantucket closing?
- It is typically collected at closing and paid when the deed is recorded, along with any required Land Bank certification.
Who usually pays the Land Bank fee on Nantucket deals?
- Payment is negotiable; buyers often pay, sellers sometimes pay, and many parties split the fee or use price and credits to balance it.
Are family transfers or trust transfers exempt from the fee?
- Some co-owner transfers, spousal transfers, and transfers to or from revocable trusts may qualify, but exemptions are fact specific and require proper documentation.
Does the Land Bank fee apply to mortgage refinances or deed corrections?
- Refinances typically are not title transfers and are often exempt, and ministerial corrections that do not change beneficial ownership may also be exempt.
Can I finance the Land Bank fee with my mortgage on Nantucket?
- Possibly, but lender policies vary; confirm early with your lender and closing attorney.
What documents are required to claim a Land Bank exemption?
- A signed exemption certification is usually filed at closing, often with supporting documents such as a divorce decree, trust instrument, or government paperwork.
