Is there a legal limit on late fees in Indiana?

No statutory cap (see reasonableness standard and notes). Contract law supplies the only standard: a late fee is enforceable if it reasonably approximates the landlord's actual loss, and void as a penalty if it does not. Indiana has no statutory formula, percentage, or dollar cap, and counties, cities, towns and townships may not set one by ordinance.

Can a landlord charge a daily late fee in Indiana?

Daily late fees are allowed if the lease provides for them. No Indiana statute addresses fee structure, so the only brake is liquidated-damages doctrine, and accrual stops when the lease term ends.

What late fees can a landlord charge in Indiana?

Verified October 2, 2026 All Indiana topics →

Indiana has no statutory cap on residential late fees and no mandated grace period — a lease-based late fee can start accruing the day after rent is due, and the only statewide limit is the contract-law rule that a late fee must be a reasonable estimate of the landlord's loss rather than a penalty.

Cited to IC 32-31-1-6 and 1 more cited source · Verified October 2, 2026

The Indiana Court of Appeals' Gershin v. Demming decision is the touchstone: late fees are liquidated damages, enforceable when proportionate and only for the duration of the lease term. The 10-day notice in IC 32-31-1-6 is not a grace period — it is the pay-or-quit cure window for a nonpayment eviction (the landlord may terminate on not less than 10 days' notice unless the tenant pays in full first), and a late fee can lawfully accrue during those same 10 days. Local governments cannot step in: IC 32-31-1-20(c)(7) bars counties, cities, towns and townships from regulating fees charged by landlords. No Indiana statute caps late fees, and no act of the 2025 or 2026 sessions added one.

Indiana late fees at a glance

Statutory cap	No statutory cap (see reasonableness standard and notes)
Mandatory grace period	None mandated statewide
Must be in the lease	Not addressed by statute
Daily fees	Daily late fees are allowed if the lease provides for them. No Indiana statute addresses fee structure, so the only brake is liquidated-damages doctrine, and accrual stops when the lease term ends. No statute addresses fee structure. Daily late fees are a lease-drafting matter policed by liquidated-damages doctrine; Gershin v. Demming, 685 N.E.2d 1125 (Ind. Ct. App. 1997) both upheld a modest lease late fee as valid liquidated damages and cut it off at the end of the lease term — once the term ends, continued nonpayment is compensated by actual damages, not accruing late fees.
Reasonableness standard	Contract law supplies the only standard: a late fee is enforceable if it reasonably approximates the landlord's actual loss, and void as a penalty if it does not. Indiana has no statutory formula, percentage, or dollar cap, and counties, cities, towns and townships may not set one by ordinance. Contract-law reasonableness only: Indiana courts treat lease late fees as liquidated-damages clauses, enforceable if they reasonably approximate the landlord's loss from delayed payment (loss of use, interrupted cash flow) and unenforceable as penalties if disproportionate (Gershin v. Demming, 685 N.E.2d 1125 (Ind. Ct. App. 1997)). No statutory formula, percentage, or dollar cap exists anywhere in Title 32, and IC 32-31-1-20(c)(7) bars counties, cities, towns and townships from regulating any fees charged by a landlord, by ordinance or otherwise.

Cite this page: "Landlord Atlas, Indiana Late Fee Laws (verified October 2, 2026), landlordatlas.com/laws/late-fees/indiana/" — free to cite and quote with a link (how these records are verified). Everything above is cited in the citations section below.

Check a late fee against the Indiana rules — free, no signup, built on the same verified Indiana law as this page.

Notes and caveats

Both blank answers are genuine absences — Indiana regulates neither the amount of a late fee nor its timing — no statutory cap and no statutory grace period exist.
Why 'must be in lease' has no statutory answer rather than a yes — No statute imposes the requirement. The writing/agreement requirement flows from ordinary contract law — a fee never agreed to is simply not a contract term — unlike Arizona's statutory writing rule.
The 10-day notice is not a grace period — Listicle sites routinely recast the 10-day pay-or-quit notice (IC 32-31-1-6, statutory form at IC 32-31-1-7, unamended since P.L.2-2002) as a grace period. It is an eviction cure window and does not defer late-fee accrual.
No $50 late-fee cap exists — Claims that Indiana has a pending bill capping late fees at $50 per late payment are not supported: no Indiana statute caps late fees, and no act of the 2025 or 2026 sessions added a cap.
Rent-to-own late-charge rules do not apply to housing — Some charts borrow the rental-purchase late-charge rules of IC 24-7-5-5, which govern rent-to-own consumer goods. That article does not govern residential leases.
Gershin's two usable holdings — Gershin v. Demming, 685 N.E.2d 1125 (Ind. Ct. App. 1997), yields two usable holdings: a proportionate lease late fee was upheld as valid liquidated damages, and accrual stops at the end of the lease term.

Common questions: Indiana late fees

Each answer is the verified value from the table above, restated as a direct answer. Free to quote with a link to this page.

Is there a legal limit on late fees in Indiana?: No statutory cap (see reasonableness standard and notes). Contract law supplies the only standard: a late fee is enforceable if it reasonably approximates the landlord's actual loss, and void as a penalty if it does not. Indiana has no statutory formula, percentage, or dollar cap, and counties, cities, towns and townships may not set one by ordinance.
Is there a grace period before rent is late in Indiana?: None mandated statewide.
Does a late fee have to be written into the lease in Indiana?: Not addressed by statute.
Can a landlord charge a daily late fee in Indiana?: Daily late fees are allowed if the lease provides for them. No Indiana statute addresses fee structure, so the only brake is liquidated-damages doctrine, and accrual stops when the lease term ends.

Citations

IC 32-31-1-6 (verified 2026) Official source
IC 32-31-1-20 · (c)(7) (verified 2026) Official source

How this record was verified: Every section these answers rest on was read on October 2, 2026 in the Indiana General Assembly's own publication of the Indiana Code at iga.in.gov (the 2026 edition, published June 30, 2026, which carries the acts of the 2026 session in each section's history line): IC 32-31-1 (termination notices, the ten-day notice for unpaid rent and its optional form, and the bar on local regulation in IC 32-31-1-20), IC 32-31-2.9 (the tenancies the residential statutes do not reach), IC 32-31-3 (security deposits, read whole), IC 32-31-4 to 32-31-7 (a tenant's property, the entry and lockout rules of IC 32-31-5-6, the 30-day notice of IC 32-31-5-4, emergency possessory orders, tenant duties), IC 32-31-10 to 32-31-12, IC 32-30-2 and 32-30-3 (actions for possession and the order of possession), IC 33-29-2-4, 33-34-3-3 and 33-34-3-15.1 (the courts), IC 36-1-2-23 (what a unit of local government is), IC 24-7-5-5 and IC 16-41-27 (mobile home communities). No 2026 public law amended IC 32-31, IC 32-30-2 or IC 32-30-3, and the 2025 and 2026 editions of those chapters are identical. Senate Enrolled Act 148 of 2020 was read as enrolled, with the General Assembly's roll calls on the veto override (Senate, February 8, 2021; House, February 17, 2021) and its record of the Governor's veto on March 25, 2020. Small Claims Rules 2 and 4 and Appellate Rule 9 were read on the Indiana courts' rules site, each with its effective date, and Gershin v. Demming, 685 N.E.2d 1125 (Ind. Ct. App. 1997), in the reporter. September 5, 2026 addendum: the decisive figures touched by the 2025-2026 enactments reviewed that day were re-read on the official host — IC 32-31-11-3 on iga.in.gov; the earlier reads stand as recorded.