Choosing the right tenant can make or break your rental experience. But in Indiana, it’s not just about who seems like the best fit. There are laws that shape how you screen, what you ask, and what you do with the answers. Get it wrong, and you could face legal trouble.
This guide walks you through the rules Indiana landlords need to know. Avoid missteps with credit and background checks, and steer clear of screening mistakes that could put your rental property at risk. Keep reading.
Key Highlights
- Indiana landlords must follow federal and state fair housing laws when screening tenants.
- Screening criteria must be consistent and lawful, covering income, credit, criminal history, and rental history.
- Background checks, tenant screening reports, and employment verification must comply with Indiana law and privacy guidelines.
- The lease agreement should reflect terms based on the tenant screening process, including rent payments and lease violations.
- Property owners must stay current with Indiana landlord tenant laws, including how to handle security deposits, maintenance responsibilities, and lease termination terms.
Fair Housing Laws in Indiana: Know Your Boundaries
Indiana landlords must follow fair housing laws at both the federal and state level. The Federal Fair Housing Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, and disability. Indiana state law adds protection for ancestry and active-duty military status.
When screening prospective renters, avoid policies or questions that could imply preference or rejection based on these protected classes. Even unintentional bias can result in a housing discrimination claim.
Stick to criteria that are legal and consistent across all applicants. This ensures you protect your rental property and stay fully compliant with fair housing regulations.
Setting Compliant Screening Standards in Indiana
Your tenant screening process should be structured and fair. You’re allowed to check things like:
- Credit reports to review financial responsibility
- Employment verification to confirm income
- Rental history including prior lease violations or missed rent payments
- Criminal background check, within limits allowed by Indiana law
Indiana doesn’t restrict the use of criminal history, but the Fair Housing Act requires that landlords don’t use blanket policies that could unfairly impact protected groups. Use criminal background checks carefully and evaluate each case individually.
Also, apply the same criteria to all prospective tenants. For example, if you require a 3x rent-to-income ratio, that should apply to every applicant.
Can You Deny a Tenant in Indiana?
Yes, Indiana landlords can legally deny a prospective tenant for valid reasons like:
- Low income or inability to pay rent
- Poor credit history
- Past lease violations
- Unpaid rent or prior evictions
- Incomplete or false information on the rental application
However, you must avoid any action that could be seen as discriminatory under fair housing laws. Always document your reasons clearly and base decisions on the same screening criteria for every applicant.
What Should Be in a Tenant Screening Report?
A tenant screening report includes everything you need to evaluate a prospective renter. This may involve:
- Credit score and payment history
- Criminal background
- Employment details
- Past rental agreements and landlord references
- Prior eviction history
Using a professional tenant screening service can help you get reliable data and stay within legal limits, especially when handling criminal records or sensitive information.
After Screening: Protect Yourself with a Strong Lease Agreement
Your lease agreement should reflect what you’ve learned through screening. If an applicant has a history of late rent payments, you might include stricter lease terms on grace periods or late fees.
All Indiana lease agreements, whether month to month leases or fixed-term contracts, must include:
- Rent payment due dates and amounts
- Lease violation consequences
- Terms for lease termination
- Maintenance responsibilities and who handles what
These details protect both the landlord and tenant once the rental unit is occupied. Partnering with a company like Complete Landlord Solutions ensures your lease agreements, screening criteria, and documentation stay legally sound.
What to Know About Security Deposits and State Rules
Indiana has no rent control laws, but Indiana landlord tenant law does have rules for security deposits. There's no legal limit on the amount, but landlords must return the deposit within 45 days after the lease ends. You can deduct for unpaid rent, damage, or other lease violations, but you must provide a written itemized list.
Failing to follow these rules could lead to legal trouble, including penalties or being forced to pay interest or additional fees.
Ongoing Responsibilities After a Tenant Moves In
Screening tenants is only the beginning. Once the lease starts, Indiana rental property owners have ongoing responsibilities:
- Responding to maintenance requests within a reasonable notice
- Keeping the unit habitable
- Following local and state rental laws
At the same time, Indiana tenants must uphold their side of the agreement. That means paying rent on time, avoiding property damage, and not breaking lease terms.
If the tenant fails to pay rent or violates the lease, landlords must follow the legal eviction process outlined in Indiana’s rental laws.
Why Tenant Screening Is Important for Property Owners
Skipping proper screening might seem like a shortcut, but it’s risky. A poor tenant can lead to unpaid rent, property damage, or costly eviction. That’s why every property owner or property manager should make tenant screening a core part of the rental process.
A reliable tenant screening service helps you find tenants who are more likely to care for the property and stay long-term. This keeps your rental property profitable and your stress low.
Complete Landlord Solutions provides the guidance and tools Indiana landlords need to screen tenants legally and effectively. Reach out today to protect your rentals and simplify compliance.
Protect Your Property with Legal Screening
Indiana rental property management starts with knowing the law. Understand what’s legal, follow state laws and federal regulations, and create a process that treats all prospective renters fairly.
A good screening process is your first defense against late rent, lease violations, and tenant turnover. And a clear lease agreement backed by legal knowledge is what keeps your business stable.
FAQ: Indiana Tenant Screening
1. Can I charge a tenant screening fee in Indiana?
Yes. Indiana landlords can charge application or screening fees. However, they must be reasonable and non-refundable, even if the tenant is denied.
2. How far back can I look in a tenant’s criminal background?
Indiana has no specific time limit, but it’s best to consider only recent and relevant convictions. Using very old or minor records could lead to fair housing concerns.
3. Can a tenant refuse a background check?
Yes, but you are not required to rent to them. Denying a tenant for refusal to provide screening information is legal, as long as it's applied consistently.