What Landlords Need to Know about the Law in Indiana

One of the most important Indiana landlord responsibilities is staying up to date on the property management laws in your state. Rental businesses are regulated on both the federal and the state levels, and researching how these laws influence your business practices is a critical step for avoiding legal trouble down the road.

To help you stay aware of how laws might affect your business, this article takes a look at some important ones for landlords in Indiana.

Rent Control is Banned in Indiana

Rent control, which places a limit on how much landlords can charge their tenants for rent, is not enforced in Indiana and is prohibited by law. This means that you can charge your tenants any amount you wish, but you should always be mindful of local pricing trends so that your prices are not outliers that are consequently not competitive. The median rent price in the state is $1,395, while the median monthly rent price in Indianapolis is slightly higher at around $1,450.

There is No Mandatory Grace Period

Some states require landlords to give their tenants a grace period to pay rent, which allows tenants to submit late payments without the penalty of late fees. A grace period generally lasts between a couple days and a week. You can give your tenants a grace period if you wish, but Indiana state law does not require that you use one. Landlords can start charging their tenants late fees for missing rent payments as soon as the due date passes.

Late Fees are Not Regulated

Speaking of late fees, it is also worth noting that state law does not outline any limit on how much a landlord can charge for late fees. If you choose to charge them, you can charge any amount you wish.

A standard late fee for a missing rent payment tends to be around 5-10% of the monthly rent payment. For example, if a rent payment falls right at the state median of around $1,400, a late fee might be somewhere between $70 and $140.

There is also nothing in the law that regulates the fees for an Indiana rental application. You can charge prospective tenants hoping to apply to your property if you wish.

Indiana Follows Federal Fair Housing Laws

It is important to know about protected classes and housing discrimination, especially during the tenant screening process. Like all 50 states, Indiana upholds the law outlined in the federal Fair Housing Act of 1968, which illegalized any form of housing discrimination by landlords or real estate agents based on race, color, religion, national origin, gender, familial status, and disability.

Landlords Must Issue a Rent Demand Notice Before Filing for Eviction

Indiana tenant laws on eviction state that if you wish to evict a tenant due to their persistent failure to pay rent on time, you must issue a rent demand notice before you file. This notice must give the tenant a period of at least ten days during which they can pay their rent and consequently resolve the issue.

Grace periods are not required by the state, but if you choose to give your tenants one, note that the ten-day period outlined in the rent demand notice should not overlap with the days of the grace period. For instance, if you give your tenants a five-day grace period, at least 15 days should pass from the rent due date before you can file for eviction. After the grace period has ended, you can charge late fees, but by law you still may not file for eviction until an additional ten days after sending the notice.

Conclusion

The last thing that you want is for any legal complications to hinder the hard work you have dedicated to your rental business. The first step towards keeping your business out of trouble is knowing the law and ensuring that you are making educated and compliant decisions.