Indiana's main landlord-tenant legislation was enacted in 1881 and has remained mostly unchanged for over a century. In recent years, however, the legislation has experienced some amendments, most significantly in 2002. Indiana ranks among the top five landlord-friendly states in the nation. Indianapolis, the capital and most prominent city in the state, is noted for its high occupancy rates.
All the landlord-tenant laws in this post are components of Indiana Code Title 32, Article 31. They are key elements of every rental agreement. Understanding each of them and the Indiana landlord-tenant laws as a whole will help ensure a healthy landlord-tenant relationship and the avoidance of legal disputes.
Rent Payments and Increases
Indiana landlord-tenant laws stipulate that tenants should pay rent at the beginning of every month unless the landlord states otherwise in the lease agreement. No rent control law exists in Indiana at the moment, and state law prohibits cities and towns from enacting their own rent control laws. This implies that a landlord is at liberty to charge whatever sum they desire as rent and also increase the rent as he likes, although such increases must be part of the lease agreement. Where rent increment is part of the lease agreement, a 30-day rent increase notice must be given to the tenant. It is illegal for landlords to increase rent in retaliation or in discrimination against federally protected classes.
State laws are silent about late fees, thus leaving it to the discretion of landlords or a subject to being mutually agreed upon when negotiating the lease terms. If late fees are applicable, the tenant must pay them if they are to meet their rent payment obligation by the due date. A landlord can take alternative action against a tenant who refuses to make late payments. However, such fees are meant to serve as compensation for costs imposed on the landlord as a result of the late payment. A court can nullify a landlord who charges fees as punishment.
There is no explicit provision for a grace period for tenants who pay rent late in Indiana's landlord-tenant laws. In the absence of such a period, a landlord may proceed to charge late fees immediately after the due payment date.
A security deposit is a sum of money that landlords are permitted to collect from their tenants to cover expenses that may arise after a tenant vacates their rental property. If such expenses do not arise, an Indiana landlord must return the security deposit to the tenant within 45 days of the tenant vacating their property. Failure to do this may provoke a court action by an aggrieved tenant.
Security Deposit Minimum/Maximum Limit
In Indiana, there are no legally stipulated minimum or maximum sums allowed as a security deposit. This lacuna has created the impression that landlords are free to charge any amount they like, subject to the condition that such charges should be reasonable.
Withholding a Security Deposit
If it is determined that a tenant has given the landlord sufficient reason to withhold their security deposit, then the law permits the landlord to withhold the deposit and use it to cover the expenses imposed by the tenant. But an itemized list of the deductions must be compiled by the landlord and made available to the tenant.
Security deposits often cover:
- Damages beyond normal wear and tear
- Damaged amenities and appliances, for example, plumbing, air conditioning systems, or smoke detectors
- Yet to be paid tenant bills
Security Deposit Interest Charges and Commingling
Landlords are not required to pay interest on a security deposit but can commingle the deposit with other assets. However, mixing security deposit with other assets may cause confusion and hence is not recommended.
Indiana tenants who decide to terminate their rental agreement are free to do so, subject to serving an appropriate notice to their landlords. Here are the notification timeframes for the different tenancy categories in Indiana:
- Week to week – 30 days' notice
- Month to month – Three months' notice
- Quarter to quarter – No statute
- Year to year – No statute
An early lease termination notice may be sent by a tenant to their landlord based on any (or a combination) of the following conditions:
- An early termination clause
- Abysmal living conditions
- Active military service
- Domestic violence
- Violation of the rental agreement terms or local housing codes
Cost of Breaking a Lease
An Indiana tenant who decides to break their lease early is still liable to pay for the remaining lease period's rent. The law requires landlords to make a reasonable effort to rent out the unit once again. If they succeed in attracting a new tenant before the lease expires, then the original tenant's liability for the remaining rent becomes nullified. A landlord cannot decide to keep all of the tenant's security deposit because the tenant broke the lease agreement. Instead, the landlord should deduct the remaining rent's equivalent from the deposit and compulsorily return the rest of the deposit to the tenant.
A variety of reasons can lead to a landlord deciding to serve their tenant with an eviction notice. But retaliatory or discriminatory evictions are illegal in Indiana. Below are the most common causal factors for an eviction in Indiana.
Nonpayment of Rent
A landlord may issue a 10-Day Notice to Pay to their tenant for nonpayment of rent. If the tenant fails to comply after the notice period, the landlord may commence eviction proceedings against them.
Violation of Lease Terms
A tenant who commits a violation (or an alleged violation) of the lease terms may receive a Notice to Cure or Vacate from their landlord. However, no specific timeframe is provided for this notice under Indiana law. The landlord may commence eviction proceedings if the tenant fails to address the violation within a reasonable amount of time. Unconditional Quit Notices can also served to tenants who have committed more serious offenses. Such notices have no provision for the tenant to correct their violation of the lease.
No Lease/End of Lease
A landlord may issue a Notice to Quit to a tenant whose lease term has ended but is still residing in the rental unit (a holdover tenant). However, the timeframe of the notice is dependent on the type of tenancy. For example, tenancies-at-will must be served a 30-Day Notice to Quit while year-to-year tenancies must receive a 90-Day Notice to Quit.
Eviction notice timeframes for illegal acts (e.g., criminal or hard drug activity) are at the discretion of landlords. For example, a landlord can discretionarily issue a 45-day Notice to Quit to a tenant engaging in illegal activity on the rental property. Landlords may even include an act not explicitly considered illegal as a cause for eviction.
Indiana does not offer any extra protection to groups not outlined in the Federal Fair Housing Act. The Federal Fair Housing Act outlaws discrimination in housing based on the following 7 protected classes:
- National origin
- Familial status
The Act excludes some owner-occupied homes and homes run by religious organizations.
Indiana's housing discrimination regulations are under the purview of the Indiana Civil Rights Commission. The following actions may be interpreted as discriminatory when directed at a member of a protected class:
- Claiming a unit is not available for rent when it is
- Rejecting an offer to rent or sell property
- Refusal to provide certain financing options
- Using threats or coercion on a tenant because they exercised their rights
- Offering varying terms, conditions, or privileges
- Refusal to make reasonable accommodations
- Targeted rent increment
Indiana landlords found culpable for housing discrimination may be liable for damages.
Small Claims Court
Landlords and tenants can head to a Small Claims Court to settle minor disputes without having to hire an attorney. The maximum amount claimed should not exceed $10,000, though the precise sum may vary according to County.
Landlords in Indiana are legally required to make the following mandatory disclosures:
Landlords whose rental properties were developed before 1978 must disclose information on the lead paint concentrations in such properties.
If a rental property is located in a 100-year floodplain (areas with a 1% annual chance of shallow flooding), the landlord must disclose such information to the tenant in the lease agreement.
The names and addresses of all parties involved in the ownership/management of the property must be provided by landlords
In Indiana, a landlord cannot legally rent out property if the property does not satisfy basic health and safety requirements. It is the responsibility of the landlord to provide their tenant with a habitable unit that meets the conditions specified in the Indiana landlord-tenant law. Additionally, the landlord must also make some specific amenities and appliances available for the tenant before the latter takes up residence. Among such amenities/appliances include:
- Electrical systems
- Sanitary plumbing systems that supply significant volumes of hot and cold running water
- Air conditioning system
- Smoke detectors
An Indiana landlord makes a significant investment to put up a safe and habitable home equipped with the above (and sometimes other) amenities and appliances for tenants. Therefore, apart from paying rent when it is due, Indiana tenants must:
- Uphold cleanliness standards by ensuring that their unit and its surroundings are garbage and hazard-free
- Properly maintain all amenities and appliances
- Use amenities and appliances reasonably
- Comply with all the provisions of the lease agreement
- Avoid defacing, damaging, or destroying any part of the rental unit
- Not constitute a nuisance to or disturb other tenants or neighbors
- Ensure that the provided smoke detectors are properly maintained
An Indiana landlord has the right to collect rent when due, collect tenants' security deposits to cover certain expenses, and initiate an eviction lawsuit against tenants who fail to comply with the lease terms. Indiana landlords also have the right to enter a rental property for inspections, maintenance, and property showings. However, apart from some emergencies, the landlord must notify the tenant in advance (usually 24 hours at least) and obtain their consent before entering the property.
Under Indiana's landlord-tenant laws, tenants have the legal right to demand habitable housing without suffering any form of discrimination. Upon getting such an accommodation, the tenant also reserves the right to request repairs (usually in writing) from the landlord for any damages to the rental property or unit. If the landlord does not carry out the needed repairs in a timely manner, the tenant may sue for costs, or a court order can force the landlord to implement the repairs. The tenant may also decide to bear the costs of the repairs and subsequently deduct the costs from future rent payments. In severe cases, the tenant may be able to cancel the rental agreement and vacate the premises.
Landlord-tenant laws in Indiana and elsewhere are often a complex maze of conditions that require a thorough grasp from both parties. A lack of clear understanding of these laws can lead to avoidable conflict between landlord and tenant. For landlords, getting landlord insurance coverage can enable them cope with the several challenges tenancy can throw up.
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