As a landlord looking to identify the best prospective tenant for your space in Indiana, you need to ensure all the required due diligence is being done. The first part of it is getting all the relevant information from potential renters.
If you don't do your own property management, then whichever party is responsible for it would be the one to ensure this is handled correctly.
Federal and state law make up the other part of the equation. There's written consent needed for a credit check, protected classes of information you can't ask for, and more!
Don't worry if it sounds like a lot to take in. Everything you need to know about the Indiana rental application process is below.
What To Include
Ask you seek to identify the right tenant, you must ask for the relevant classes of information to support the upcoming screening process. Thankfully, a landlord is allowed to customize an Indiana rental application form. Typical pieces of requested information include:
- Personal information for every intended potential tenant
- Income details
- Written consent for background checks
- Personal references
- Rental history
Legal Disclosures to Be Made
A landlord also must ensure that anyone filling out a rental application receives important disclosures on the document. These include:
- Rent control rule
- Smoking policy
- Application fee and other charges
- Security deposit information
- The condition of the rental property
What Not To Include
By order of the Federal Fair Housing Act (FHA), a landlord may not request certain protected classes of information on an Indiana rental application form. Even if the said details are known outside the application process, they are not to be used in considering a rental application for approval or denial.
The idea here is to prevent discrimination. The said classes of information are as follows:
- Familial status
At the state level, there is further protection afforded for ancestry. An applicant has up to a year to report potential cases of discrimination to the Indiana Civil Rights Commission.
Background Check Types
During the screening process, there will be a background check to understand more about the potential tenant that filled out the rental application. Of course, these checks feed into the idea of ensuring that the applicant who is eventually selected is a good fit for the property. Here's a quick look at the three background check types.
Credit History and the Federal Credit Reporting Act (FCRA)
The credit check is just that. It aims to help Indiana landlords understand what the applicant's credit situation is. Such information will include previous credit inquiries and credit score details.
The FCRA mandates that any request for this kind of information must be preceded by written consent from the prospective tenant.
Here, Indiana landlords will aim to understand the extent of past criminal activity that the potential renter was involved in. This will include records at the state level and presence on any federal listings such as the sex offender registry.
Rental (Eviction) History
The tenant hopeful is likely coming from one or more other properties as a renter. Since eviction history is maintained for up to seven years, it becomes possible to get some insight into any judgments or other eviction decisions that the applicant may have been at the center of before.
Notice of Eligibility
The Indiana rental application process from one landlord to the next will often vary, as will the screening criteria. Nevertheless, an applicant has the right to know what scale landlords will be using to deny or approve a rental application.
Therefore, a notice of eligibility must be given to the possible tenant. Additionally, the applicant must provide a signature of an acknowledgment as proof that the details were shared.
Application Fees and Security Deposits
Landlords in Indiana are allowed to charge whatever figure they may see fit as an application fee as no law says otherwise. Nevertheless, the recommendation is usually not to charge an exorbitant fee, instead basing it on the administrative costs that may come with the process.
Security deposits also get the same treatment, as there is no legal maximum amount. Boundaries may be put in at the county or city level, however.
Adverse Action Notices
After the rental application form is submitted and the screening process begins, you may find that a consumer report, i.e., credit history, criminal history, or eviction history, indicates unfavorable information that may make you want to:
- Increase the rent
- Increase the security deposit
- Require a co-signer
- Reject the applicant
When landlords decide to do any of these things to a possible tenant, it is known as an adverse action, and it must be handled adequately.
An "adverse action notice" must be provided to the applicant. This will include the details of the reporting firm and the details surrounding the discovery. Even if the information discovered is not the main reason for the action, the notice must still be given.
A 60-day window is allowed for a dispute to be brought forward.
Build Your Own
When you have concluded your Indiana rental application process and selected a tenant, you will need to prepare a lease agreement. In doing so, you have two choices:
Wrapping It Up
Now, you have all the insights you need to ensure that your rental application procedure runs as smoothly as possible. The key things to remember are to adhere to any legal requirements, while ensuring that your form is designed well enough to collect the details you need.
Of course, you must steer clear of protected classes of information such as race, familial status, and the like.
If you need assistance crafting your Indiana rental application form and even doing your screening, consider allowing Doorloop to assist you!
Can an Application Fee Refund Be Requested for a Failed Rental Application?
No. Regardless of the amount that a possible tenant had paid, application fees in Indiana are non-refundable.
Is Hiring a Third Party Recommended for Screening Applicants?
Yes. Screening your tenants should be done by a team that is highly familiar with the legal side of the Indiana rental application process, as well as one that is willing to understand what you want to see in tenants and apply that to the selection method.
What if I Didn't Ask for a Protected Class of Information But I Have It? Can It Be Used as a Part of the Screening Criteria for Rental Applicants?
If you happen to come across one of the protected classes of information outside of the application form, it is still illegal to use it as an area of consideration for application approval or denial.