Breaking a Lease in Indiana

Find out when a tenant can legally break a lease in Indiana when they can’t, what options they have if they don’t have a proper cause, and what the consequences are of walking out on a lease agreement. Learn how landlords can break a lease, when they can break one without cause, and how much notice they have to give.

Importance of Fixed Periods in Lease Agreements

Without a fixed period, a landlord generally has the same rights as the tenant to terminate tenancy (with proper notice). In the same way that a landlord lacks long-term security on a month-to-month (or shorter period) lease if a tenant decides to leave, tenants lack the same security if the landlord decides to change the terms (i.e. raise the rent) or end the lease altogether. 

That’s why fixed periods are an important protection for both parties. They’re not just there to act as a restriction to tenants. 

As a result, there are real legal consequences for violating the agreement without proper cause on either side. It’s important to understand when a tenant can get out a lease with a fixed period that hasn’t ended, and when a tenant can’t.

Lease Termination Notice Requirements in Indiana

In Indiana, a tenant is not required to provide notice for fixed end date leases, the lease expires on the last day of the lease (IC 32-31-1-8). Tenants are required to provide notice for the following lease terms:

  • Notice to terminate a month-to-month lease. One-month written notice from the tenant is required (IC 32-31-1-1).
  • Notice to terminate a yearly lease with no end date. Three-months’ written notice from the tenant is required (IC 32-31-1-3).

Conditions for Legally Breaking a Lease in Indiana

There are a handful of scenarios where a tenant can legally break a lease in Indiana without penalty. We’ll go through each of them below.

1. Early Termination Clause

Some modern lease agreements may provide specific terms that would allow a tenant to terminate a lease early in exchange for a penalty fee. Read over the lease and look for language that outlines agreed-upon terms for ending the lease before the end of the fixed period, such as the amount of the fee (i.e. equal to 2 month’s rent) and the amount of notice required (i.e. 30 days).

If a lease agreement contains an early termination clause, before executing it and paying the penalty fee, read further to learn about other conditions that, if met, would not require a penalty fee to be paid.

2. Active Military Duty

The Servicemembers Civil Relief Act (SCRA) helps protect active service members who are relocated due to deployment or permanent change of station. The protection begins on the date of entering duty and ends between 30-90 days after the date of discharge.

To break a lease in accordance with the relief act, a tenant must:

  • Prove the lease was signed before entering active duty 
  • Prove they will remain on active duty for at least the next 90 days
  • Deliver a written notice to the landlord (example, page 2), accompanied by a copy of the orders to deploy / PCS or a letter from their commanding officer stating their pending deployment.

With that said, the lease does not terminate immediately. Once the notice is delivered, the earliest the lease can terminate is 30 days after the beginning of the next rent period. So for example, if the notice was delivered on the 23rd of March, and the rent is due on the 1st of each month, the earliest the lease can terminate is May 1st (meaning, rent is still due for the month of April).

NOTE

In Indiana, the term “servicemember” means a member of the armed forces, commissioned corps of the National Oceanic and Atmospheric Administration (NOAA), commissioned corps of the Public Health Service, and the activated National Guard.

3. Unit is Uninhabitable

Every state has specific health and safety codes that provide minimum standards for rental units, and Indiana is no different. 

If those standards are not met, proper notice is given by the tenant and the repairs/fixes are still not made within the allowable time period, a tenant would be considered “constructively evicted”. As a result, the obligations of the tenant under the lease are no longer required, given that the landlord has not met their own responsibilities under the Indiana landlord-tenant law. 

Landlords must maintain the premises to protect a tenant’s safety and health. Landlords must comply with city and county ordinances and state laws regarding housing conditions. Indiana landlord duties to provide habitable premises include the following examples (IC 32-31-8-5):

  • Deliver the rental premises to a tenant in compliance with the rental agreement, and in a safe, clean, and habitable condition
  • Comply with all health and housing codes applicable to the rental premises
  • Make all reasonable efforts to keep common areas of rental premises in a clean and proper condition
  • Provide and maintain the following items in rental premises in good and safe working condition, if provided on the premises at the time the rental agreement is entered into: 
    • Electrical systems 
    • Plumbing systems sufficient to accommodate a reasonable supply of hot and cold running water at all times
    • Sanitary systems
    • Heating, ventilating, and air conditioning systems
    • Elevators, if provided
    • Appliances supplied as an inducement to the rental agreement
  • A heating system must be sufficient to adequately supply heat at all times

4. Landlord Harassment or Privacy Violation

If the action is serious enough, harassment by a landlord or their violation of a tenant’s privacy may be enough justification for relieving a tenant of their obligations of the lease.

  • Landlord entry.Indiana requires landlords to provide a “reasonable” written or oral notice. No exact amount of time is specified but generally, 24 hours is recommended. (IC 32-31-5-6(g)). If your landlord repeatedly violates your rights to privacy or does removes windows or doors, turns off your utilities, or changes the locks, you would be considered “constructively evicted,” as described above.
  • Changing the locks. In Indiana, a landlord cannot lock out a tenant and is punishable by two month’s rent or free occupancy (IC 32-31-5-6(c)).

5. Domestic Violence

Examples of Insufficient Justification for Lease Breaking

The below reasons are generally not enough justification (on their own) to release a tenant from the obligation of their lease term, and as a result, provide no legal protection against penalties for not honoring the lease.

  • They bought a house
  • They are relocating for a new job or school
  • They are upgrading or downgrading
  • They are moving in with a partner
  • They are moving to be closer to family

Since state landlord-tenant laws vary, the following reasons may legally permit a tenant to terminate their tenancy early in other states but are not applicable in Indiana:

  • Violation of the lease agreement. If a landlord violates the terms of the lease agreement, it may be enough justification to break the lease and relieve the tenant from their own obligations (i.e. illegally raising the rent during the fixed period).
  • Illegal contract. In some scenarios, a lease agreement may be deemed illegal and as a result, is generally not enforceable. 
  • Mandatory disclosures. Many state and local laws require landlords to disclose documentation, policies, or specific unit information to tenants prior to moving in. Disclosure laws typically impose heavy fines or legal ramifications to landlords if they are not followed. In rare cases, they contain penalty provisions that may allow you to break your lease. 
  • Senior citizen or health issue. Some states offer age or health-related lease-breaking arrangements that permit early lease termination. 

Breaking a lease for any of the above reasons or in any conditions not previously outlined can have tangible consequences for tenants.

Tenant’s Options if Legal Justification is Not Met

If the previously stated legal conditions are not met, there are still a few options that a tenant has that could allow for them to not be obligated to pay rent until the end of the fixed period.

Talk with the landlord

Some landlords may be understanding and willing to negotiate with a tenant. Every situation is different, and every landlord is different. A tenant’s best chance at getting a landlord to work with them is, to be honest about the reasons for leaving, to provide as much notice as possible, and to propose possible resolutions that could be mutually beneficial (i.e. by paying 2 month’s rent). 

Aid in finding a new tenant

If the tenant moves out before the end of the fixed period, they are still required to pay rent until the end of the period until a new tenant is found. During that remainder period, the landlord is not required to make reasonable effort to find a new tenant (if they don’t, the previous tenant is not responsible for future rent). 

Therefore, the previous tenant may choose to be proactive and help to find a new tenant on their own, instead of waiting for the landlord to find one. The landlord does not have to accept the newly found tenant if they have reasonable justification (i.e. they have bad credit or rental history), but helping to find a new tenant can only help increase a tenant’s chances of being relieved of future rent.

NOTE

In Indiana, landlords do not need to make reasonable efforts to rerent the unit.

Sublet

If your lease does not prohibit subletting, then you are in the clear to do so. However, your lease might contain a clause requiring you to obtain your landlord’s approval prior to subletting. To get landlord approval you will want to send them a letter through certified mail, with a return receipt requested, outlining the terms of the sublet lease agreement. Certified mail is the only proof of delivery that most courts will accept in case you need to prove that you notified your landlord. 

Consequences of Illegal Lease Breaking

If a tenant breaks a lease without mutual agreement from the landlord or without the proper legal justification and does not pay the rent due for the remainder of the fixed period, the tenant faces the following consequences.

  • Loss of security deposit. Usually, at a minimum, a landlord may choose to withhold the security deposit. 
  • Lawsuit. A landlord may sue the tenant for unpaid rent during the fixed period, which if won, could result in the tenant facing a money judgment. That judgment, if not paid on the spot or if terms are not set for a long-term payment plan, could result in the garnishment of the tenant’s wages or bank account.
  • Impact on credit score. While a money judgment won’t show up on a tenant’s credit report (thanks to the National Consumer Assistance Plan), if the landlord chooses to go an alternative route to collecting on unpaid rent by using a debt collection agency, the tenant’s credit score could be severely impacted.
  • Difficulty in finding future housing. Whether or not a tenant provides the landlord’s name & contact information themselves when looking to buy or rent in the future, a background check will most likely provide the future landlord or mortgage lender with that information. That previous landlord could provide a very negative reference.

Read About Breaking a Lease in Other States

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