Evictions in Indiana

[Alex Corral]

I want to ask your experience with evictions you’ve had in Indiana. What are your typical timelines before a tenant is served with an eviction notice & they are evicted? What has been your experience with costs? What are the requirements to get rid of the tenants possessions they have left on your property? I have been dealing with 2 very long & costly evictions. The tenants stopped paying in September 2018, had their hearing early January. Evicted about mid January.. left all their possessions & I just had to pay to pack up their stuff (over $800). I’m not sure of conditions yet, but I still need to pay for a cleaning, *hopefully just minor rehab.. paint.. etc. But I’m looking at a total loss of about $10,000 total. Would appreciate any advice, where I could minimize this from happening again. I’m a new investor (under 2 years in the game).

[Ross Denman]

@Alex Corral it depends on the market your in. Every state and city are different. You can even have different experiences in different townships in the same city.

We have a very low eviction rate (around 1.5%) and we do have some other strategies that we employ other than evictions as well. Lease terminations, cash for keys, etc.

Our PM company charges $450, but the actual cost is just the court filing fee (around $100 in most townships in Indianapolis.)  Other than that, it's just time involved with going to court, occupancy checks, etc.

Typically a tenant in served about 10-14 days after the filing.

Courts require a minimum of 10 days of service before the court date. We usually see 10-14 days but it will also be longer around the Christmas holidays.

Tenants are usually given 5-14 days (depends on the judge) to vacate the home.

Tenant possessions are tricky. My recommendation is to have the tenants document that they do not want anything that's left in a property. Text, emails, signed letter, whatever. I do not know that exact time to hold possessions (maybe 30 days, but I'd ask an attorney) but the last thing that you want is a tenant to come back and say that the trash you threw away was a priceless family heirloom.

Wow... you had a "pack-out" too. We've only had that happen twice with us, but it is an extra expense and it sucks.

As far as minimizing evictions... here's some recommendations:

• Location, Location, Location. Anybody can suffer divorce, death in the family, lay off, etc, better tenants find better ways of getting through this. They leave the homes in better shapes. They want to work with you and do the right things and often are embarrassed to be in the position they are in. Riff-raff simply don't care one way or the other. They are always victims.
• Desirable products. The best tenants have the ability to choose where they live. If you home is not on that list, you have to settle for tenants that have to settle as well. Have clean and inviting homes in good neighborhoods that rent at the top of the local market.
• Pre-Screen and Screen prospective tenants. Tenant screening is vital. Ensure that they make enough money, pay their bills, and haven't had issues in the past. Be very careful with tenants with criminal history and pass on tenants with prior evictions. Just because they make plenty of money, doesn't mean that they don't have a serious drug addiction or other issues. If there are any risk factors but a tenant seem ok overall, consider increasing the amount of security held and get lease guarantors if need be... or better yet... pass all together.
• Properly maintain the home. Last year we took over management of a non-performing tenant who was withholding rent because of some serious issues in the home that were not being addressed. The mold growth had gotten so bad that the kids were getting sick. The leak in the crawl space was costing them hundreds of dollars in their water bill. After we took over and got everything taken care of... they decided to take their 3 months of rent with them and moved out. It probably could have been avoided with a proactive PM from the beginning.
• Maintain good tenant communications and relationships. If tenants are having trouble, it's better to have them communicate early and try to help find solutions than to be heavy handed with eviction. It just costs our clients money to go that route. Are there assistance programs available? Can payment arrangements be made to get them current and caught up? Are there family members that can help? If not, can they pay something and leave the home in broom swept condition so we can quickly turn it and keep the production up? Communication and creative solutions are always better than using you legal bulldozer.

Evictions are terrible for everyone and need to be protected against at every stage when possible. That's why I preach against properties in low-income areas and tough neighborhoods. Those deals look great on paper, but empty houses produce a negative ROI... regardless of what the wholesalers proforma said.

Good homes in good neighborhoods with good tenants being proactively managed by an experienced property manager will protect you from a lot of risks... and all of those risks cost a lot more money than the extra $10k-$20k you could have spent on a better property or the few hundred dollars a year spent on a better property manager.