Landlord Atlas

What late fees can a landlord charge in Indiana?

Verified July 9, 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.

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) preempts any city or town ordinance regulating fees charged by landlords. Reports of a pending Indiana '$50 late fee cap' law are false — no such bill exists in the 2025 or 2026 General Assembly records.

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 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 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) forbids cities and towns from capping 'any fee charged by a landlord' by ordinance.

Notes and caveats

statutory_cap and grace_period_days are both null — Indiana regulates neither amount nor timing. must_be_in_lease is null rather than true because 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 AZ's statutory writing rule. Three traps debunked: (1) the 10-day pay-or-quit notice (IC 32-31-1-6, form at 1-7 — 2013 official text read; treat as single-host-verified detail) is routinely recast by listicle sites as a 'grace period'; it is an eviction cure window and does not defer fee accrual. (2) A circulating claim (rentlatefee.com and syndicated copies) that Indiana has a pending bill capping late fees at $50 per late payment matches no bill in the 2025 or 2026 IGA sessions (sweeps of the IGA 'Landlords and Tenants' subject list and LegiScan on 2026-07-09) — treat as fabricated until a bill number surfaces. (3) Some charts borrow the rental-PURCHASE late-charge rules of IC 24-7-5-5 (rent-to-own consumer goods) for housing; that article does not govern residential leases. Gershin is cited in text fields only (case law does not belong in the citations array); its two usable holdings: proportionate fee upheld, and accrual stops at lease-term end.

Statute citations

How this record was verified: Indiana's official code viewer (iga.in.gov) is JavaScript-rendered and returns no statutory text to non-browser clients, so text was verified on two independent code mirrors and reconciled verbatim: FindLaw (codes.findlaw.com, 'current as of January 01, 2026') and Justia's archived official-text PDFs of IC 32-31 chapters 1, 3, and 5 (statecodesfiles.justia.com, 2013 edition, carrying the official 'As added by P.L.' history lines). Sections double-read across both hosts with figures matching verbatim: IC 32-31-3-12, 32-31-3-14, 32-31-3-15, 32-31-3-16 (45-day deadline, forfeiture rule, attorney fees), 32-31-5-4 (30-day modification notice), 32-31-5-6 (entry, all subsections), 32-31-1-1, 32-31-1-2, and 32-31-1-4 (termination-notice periods); 32-31-3-12/-14/-15/-16 were additionally read on law.onecle.com. IC 32-31-1-20 (preemption) was read verbatim on FindLaw (current through Jan. 1, 2026) and in the pre-amendment 2013 official text; subsection (c)'s enactment was confirmed against the SEA 148-2020 bill record and contemporaneous coverage of the February 17, 2021 veto override (assigned P.L. 168) — a cross-host read of the CURRENT (c) text was not obtainable this session (Justia, Casetext, LegiScan, LawServer, and archive.org all blocked automated fetches) and is a carry-forward. Scope sections IC 32-31-2.9-1/-3/-4, 32-31-5-1, and 32-31-5-3 read on FindLaw/2013 PDF. 2025-2026 session sweeps (IGA subject list 'Landlords and Tenants', LegiScan) on 2026-07-09 found no enacted change to any encoded field; 2026 bills SB 127 and HB 1435 died at the session's March 2026 sine die adjournment, and HEA 1001-2026 (signed) addresses zoning/permitting only.