COVID-19 and Indiana Landlords

Navigating the Pandemic as an Indiana Landlord – Updated 6/27/20

The COVID-19 pandemic has affected most people in one way or another. Landlords and real estate investors are no exception. With federal and state moratoriums on evictions and foreclosures, landlords and lenders must be diligent to keep their real estate investments and rental property cash flows out of the red.

Most responsible investors budget for roughly 8 to 10 percent in lost rent due to vacancies and tenant turnover. However, it is doubtful those budgets factor six plus months of no rental income. Take for example the “best” case scenario where a tenant became delinquent in March at the beginning of Indiana’s state of emergency. With no ability to file an eviction until Indiana’s stay of evictions is lifted (currently August 01, 2020), plus the typical 4-5 week time frame from the date of filing to an actual possession date, landlords could find themselves without rental income from March through September.  Nearly 7 months!

So, what should Indiana landlords do to get through these times?

Follow the Rules!!

First, landlords and lenders need to take care to adhere to local and federal mandates.

The CARES Act – Federal

On March 27, 2020, Congress passed the CARES Act, some of which directly affect landlords and lenders. Specifically, the CARES Act put in effect a moratorium through July 24, 2020 prohibiting landlords and lenders from filing an eviction or foreclosing on a mortgage (exclusive to residential homes) for nonpayment of rent. It also prohibits landlords from charging late fees, penalties or the likes under the lease or mortgage related to nonpayment of rent.

However, these prohibitions are not applicable to ALL landlords/lenders. The CARES Act only applies to tenants/homeowners if the property is covered under HUD or other housing programs such as Section 8. It also applies to borrowers with federally-backed mortgage loans like Fannie Mae. Click here to review the CARES Act in its entirety.

Indiana Protections

In addition to the CARES Act, on March 19, 2020, Governor Eric Holcomb signed Executive Order 20-06 that prohibited in Indiana new filings for all evictions and foreclosures on residential property during the state of emergency. On May 1, 2020, the state of emergency (and therefore the stay on evictions) was just extended through June 4, 2020 (UPDATE 6/27/20 – Governor Holcomb has announced he will be extending the stay on all evictions and foreclosures through August 1, 2020.  However, emergency evictions and emergency foreclosures can be filed per Executive Order 28. ). Unlike the CARES Act, Indiana’s moratorium is not limited to evictions and foreclosures for non-payment or to properties in a covered housing program.  As written, Indiana’s moratorium on evictions only applies to filing new lawsuits. Unfortunately, many Indiana courts have interpreted the governor’s order to be a stay on all eviction proceedings, rather than just the initiation of a new lawsuit. UPDATE 6/27/20 (While the Governor’s first order, Executive Order 20-06, applied only to new filings, his extensions, and particularly Executive Order 28, now include the phrase “or proceedings” which can be interpreted to include all aspects of the eviction process. Until the legislation issues some guidance, landlords should not continue with an eviction process to avoid having tenants filing claims with the Attorney General for evicting the tenant against the executive order(s). Review all of Indiana’s executive orders related to COVID-19 here.

Be Understanding

Everyone is feeling the economic effect of COVID-19 in the form of Stay at Home Orders, travel restrictions and business closures. Tenants are no exception. Some tenants have seen a drastic reduction in work, been laid off, or been temporarily put out of work. The federal stimulus package and unemployment benefits should allow non-paying tenants the ability to begin making their rent payments again. However, not everyone has received their stimulus check or have been able to receive unemployment benefits. Most tenants do not actively look to avoid paying rent, but rent may not be a tenant’s first priority. It is probably a very high priority, but putting food on the table will come first.

Be Proactive

Some landlords have been very proactive and reached out to tenants with offers of waiving late fees, offering payment plans, accepting credit card payments and providing tenants information on how to obtain government assistance or file for unemployment. For example, the Indiana Department of Veterans Affairs is now utilizing its Military Family Relief Fund for COVID-19 relief for Indiana veterans.  Anything that helps the tenant not feel despair will ultimately help the landlord.

Take What You Can Get

In these unprecedented times, landlords will be best served to acknowledge tenants’ hardships and work with tenants as best as possible to weather this storm. Without the ability to evict or foreclose, landlords must consider that partial payments are better than no payments.

Cash For Keys

In some cases, it might even cost less for a landlord to pay the tenant to move voluntarily. Cash for Keys becomes even more viable knowing that eviction is not possible.  As painful as the thought is, paying the tenant one month of rent (contingent upon a final walkthrough to confirm no damages) would be far less costly than going four more months with no rental income.

Talk to Your Lenders

Landlords still have to answer for the mortgages carried on their investment properties and should be proactive and talk to their lenders for available options. Service providers, banks and lenders do not want a repeat of the 2008 housing crisis. Most banks have been offering forbearance programs, deferred payments, waiving interest and late fees or offering short-term interest only payments on loans. However, the lender is not likely to be the party initiating these offers. Landlords (as the borrower in this case) need to be the ones initiating the calls and inquiring about available options. Fannie Mae has a dedicated page,, for borrowers to learn more about what options might be suitable for their specific situation.

What Not To Do

Do not Engage in Self-Help

Indiana Landlords must not resort to self-help such as changing the locks, refusing to perform repairs, turning off utilities that the landlord is responsible for, or removing the stove or refrigerator to force the tenant to move. Self-help is illegal in Indiana as it relates to residential property, and landlords who engage in this behavior subject themselves to lawsuits with hefty penalties. In Indiana, the Attorney General stated landlords may face hefty fines for filing for eviction and encouraged Hoosiers that receive an eviction notice to file complaints against their landlords.

Being forceful and aggressive towards tenants falling behind on rent will just be ineffective during this crisis. Without the ability to evict, there is no “or else” a tenant has to be concerned about. This leaves landlords with little recourse for a tenant who cannot pay.

Get Legal Help

As an Indiana landlord or real estate investor, make sure to utilize a knowledgeable real estate attorney. Specifically, an Indiana real estate attorney familiar with landlord-tenant law. If you have questions about this, landlord/tenant matters, foreclosure process, or any other general real estate matter, please call Rollins Law Group at 317-558-9677 or contact us online for a free consultation.


These materials are intended for general information purposes only.  Therefore, they do not constitute legal advice or legal opinion. You should consult with legal counsel to determine how laws or decisions discussed herein apply to your specific circumstances.


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