Breaking a Lease in Indiana | Tenant & Property Manager Rights

Indiana law has different provisions for tenants who want to move out of an apartment or rental unit before the lease expires. Typically, the tenant's goal is to avoid any further rent obligation when they move out. However, if they don't meet certain requirements under the Indiana landlord-tenant law, they may have to face consequences and penalties.

If you're a landlord, you must learn all of these provisions so that you can prepare if your tenant tries to break the lease early. That way, you will ensure you get compensated for all the potential money you could lose while your rental unit is vacant.

About the Notice Requirements to End a Rental Lease in Indiana

Tenants in Indiana with a fixed-term lease don't have to send any notice to end it. In these cases, the lease ends on its last day.

On the other hand, those with a periodic lease will need to provide one out of the two notice options:

• Monthly Leases: At least one month of written notice.
• Yearly Leases: At least three months of written notice.

The tenant can either send a copy of the notice to the landlord via registered or certified mail; that way, they can get a receipt that shows the landlord received it. If not, they can serve the notice letter in person.

Can Tenants Move Out of a Rental Property Without Penalties?

In some cases, tenants will be able to legally break a lease, meaning they won't pay penalties. However, these are particular scenarios that aren't too common.

Let's go over all of the conditions that will allow a tenant to break a lease agreement in Indiana.

Early Termination Clause

'Early Termination Clauses' are meant to protect both the landlord and tenant in these events. Here, you can include all the provisions necessary to ensure a smooth termination process.

Some of the most important factors include specifying the cases where the tenant may be able to move out without penalties, the potential penalties they may face if they don't follow the rules, and the notice period you consider appropriate.

If the tenant wants to break a lease for any reason, then they must first review the terms of the lease to know what to do. Otherwise, they will be exposing themselves to a lawsuit -- they will agree to all of these terms once they sign the lease document.

Uninhabitable Unit

Indiana has a set of health and safety regulations that landlords must follow if they want to avoid legal problems with their tenants.

Generally speaking, tenants have the right to request a habitable and safe rental unit to be in. If they ever find a considerable health or safety hazard inside the property, they can request repairs.

Now, if the landlord fails to provide these repairs under the specified timeframe, the tenant could be released from their obligations related to the lease, meaning they can leave.

Some of these rules include the following:

• Complying with any applicable health and housing codes in Indiana.
• Delivering the rental property as agreed. The property must be in a clean and safe condition.
• Keeping all common areas in good working order.
• Supplying a heating system.
• Supplying running water.
• Providing maintenance for the utilities and selected appliances.

Active Military Duty

An Indiana tenant who's starting military service may end their lease under the protection that the Servicemembers Civil Relief Act (SCRA) offers. In essence, the 'act' protects those who need to get relocated due to a permanent change of station or deployment.

If the tenant breaks the lease in accordance with the 'act,' they must keep in mind it will not end immediately. Overall, they can only terminate the lease 30 days after the next period for paying rent starts.

Those eligible for ending a lease under the protection of the SCRA include members and commissioned corps of the:

• National Guard
• Armed Forces
• National Oceanic and Atmospheric Administration (NOAA)
• Public Health Service

To end a lease in this case, the tenant needs to send proper notice and the necessary documentation to prove they're being relocated due to deployment or other similar reasons. Moreover, they must prove they will remain on duty for 90 days at a minimum and that they signed the lease before starting their service.

Landlord Harassment

Tenants can argue they're being harassed by their landlord, and if they can prove the actions were severe, they could avoid penalties once they move out.

Common scenarios include:

• Entering the property without any notice.
• Changing the locks of the property without the tenant's consent.

Domestic Violence

Tenants who are victims of domestic violence may move out of the property and avoid penalties in some cases. However, it's essential to note that landlords are entitled to verify the tenant's claims.

In those cases, the tenant can provide a copy of any civil order for protection, restraining order, or any other applicable document.

Landlords, on the other hand, aren't allowed to retaliate against their tenants because of their domestic violence status.

Other Reasons to End a Lease Legally in Indiana

Here are some additional arguments that tenants may use to break their lease agreements. Even though they're valid most of the time, Indiana law requires tenants to get their claims approved by a court first:

• Violations of the Lease: Landlords who break the lease's rules frequently will 'constructively evict' their tenants. This means they may not have to pay penalties if they move out.
• Mandatory Disclosures: Most states have a list of mandatory disclosures the landlord has to include in the lease (i.e., lead-based paint). If the landlord fails to provide these disclosures, they may face penalties.
• Illegal Contracts: If a court finds the lease agreement to be illegal or unenforceable, the tenant will be able to move out without paying penalty fees or facing any other related consequences.
• Reasonable Accommodations: Some landlords have a duty to provide reasonable accommodations according to the Fair Housing Act and the Americans with Disabilities Act. These accommodations are meant to cover senior citizens or those with a qualified disability. Not being able to provide these accommodations could result in a 'constructive eviction.'

Are There Any Invalid Reasons to Break a Lease in Indiana?

Yes. If a tenant ever tries to break a year-to-year or month-to-month lease under any of these arguments, they may still need to pay the remaining rent.

This is because these arguments often don't provide enough justification to release a tenant from their duties in the lease agreement:

• Moving out to move closer to someone else.
• Moving in with another person.
• Upsizing or downsizing.
• Moving out because of local criminal activity.
• Relocating for another job or school.
• Buying a new house.

In these cases, it's much safer for the tenant to try to negotiate with their landlord. If they send proper notice, the landlord will likely be more open to negotiating lower penalties.

How Can Landlords Enforce Penalties and Get Compensated?

An 'Early Lease Termination' clause is the best way to protect yourself against potential issues. There, remember to include everything the tenant needs to know if they ever want to move out before the lease term expires.

If the tenant moves out, you have the right to ask them to comply with the guidelines you established in the lease before they signed. Now, if the tenant refuses to pay penalty fees, you can sue through a small claims court.

Some common penalties include:

• Paying an amount equal to one or two months of rent.
• Keeping the security deposit.
• Filing a lawsuit.

Does the Landlord Have a Duty to Re-rent the Property?

While landlords have a duty to try to mitigate damages by finding a replacement in Indiana, the tenant won't be off the hook if they're not able to find someone else in time.

Moreover, the landlord doesn't have to relax their rental standards to find someone faster. The tenant may try to help the landlord find someone else, and the landlord can charge the tenant specific fees, including tenant screening and advertisement.

If you're able to find a replacement in time, the tenant will only be responsible for the money you lost while the property was vacant. On the contrary, if you can't find someone, you can still charge the tenant for the money they owe.

Can Tenants Sublet the Property to Pay Rent?

If you include a subletting clause in your agreement, the tenant may make a request to find a subtenant to pay rent for the rest of the lease term.

The "request" letter must include all the proposed terms for the subletting process. Then, the tenant must send the letter through certified mail with a return receipt, which is meant to ensure the landlord received it.

If you agree to the proposal, then you will keep receiving rent, and the tenant will be able to move out. On the other hand, if you want to deny the request, make sure you're doing it for appropriate reasons.

Bottom Line

Including an 'Early Termination Clause' in your lease agreement is one of the best ways to protect yourself (and the tenant) from any problems later.

Make sure you communicate with your tenant frequently to ensure they understand the terms of your lease, including the consequences of breaking a lease without a valid reason.

Even though these clauses won't prevent a tenant from moving out before the lease expires, they can help you get compensated if something goes wrong.