Indiana DSCR and Fix and Flip Loans: Fees, Permits and Tax Caps
Low registration fees, but rentals lose the homestead tax cap.
- DSCR, fix and flip and portfolio loans
- No income documentation for DSCR; most borrowers have 660+ credit, lower scores reviewed case by case
- $75,000 to $5 million
By Beltway Lending. Updated November 2026.
Indiana keeps some landlord costs low by law. A city can charge no more than $5 a year to register a rental, and state law, not each city, sets the rules on deposits, screening and lease terms. The cost that surprises buyers is property tax. While a house is the seller's homestead, its tax bill is generally capped at 1% of gross assessed value; once it becomes your rental, the cap rises to 2%, and taxes approved by voters in a referendum can push either bill higher.
We're Beltway Lending, an investor lender in Kingsville, Maryland, and Indiana is one of our most active states.
Our loans at a glance
| DSCR rental loan | Fix and flip loan | Portfolio loan (2+ rentals) | |
|---|---|---|---|
| Qualifies on | Rent compared with principal, interest, taxes and insurance | The deal and the property | The rentals' combined performance |
| Term | 30-year fixed, no balloon; 40-year available | Typically 6 or 12 months | 30-year fixed |
| Time to close | As little as 10 days; typically 3 to 4 weeks | As fast as 5 days; generally 2 to 3 weeks | Generally just under 30 days |
Because the tax cap jumps when a homestead becomes a rental, the taxes in a DSCR calculation should be the rental figure, not the seller's. Market rent can be used even if the house is empty at closing. Flips can need as little as 10% down, plus closing costs and reserves, and no experience is required. Loans run $75,000 to $5 million for investment property, to individuals, LLCs, corporations and trusts; the details sit on Loan Facts, and a portfolio quote covers two or more rentals.
Questions to put to any Indiana lender
- Will your DSCR math use the rental tax bill, at the 2% cap, or the seller's homestead bill?
- When I finish the flip, can I refinance into a 30-year loan with you?
- Is there a prepayment penalty, and how does picking a lower one change the rate?
More: How to Choose a DSCR Lender. On our DSCR loans the prepayment penalty is optional; a lower or no penalty generally means a higher rate.
Indiana rules that change the math
- Property tax caps, with exceptions: Indiana caps property taxes at 1% of gross assessed value for an owner's homestead and 2% for other residential property, including rentals. These are caps, not tax rates. Taxes approved by voters in a referendum are not subject to the caps, so a bill can land above them, and deductions also change the total. Ask the county auditor for an estimate based on rental use. (DLGF Tax Bill 101, DLGF referendum information)
- Registration costs little: A city or county can charge an annual rental registration fee of no more than $5. After a sale, it can require the new owner to update the registration and pay that fee within 30 days. (IC 36-1-20-5)
- Indianapolis registration: Indianapolis requires every rental to be registered with a manager who lives in Indiana and renewed by January 1. Registration is not the same as inspection: Indianapolis's registry has no inspection program, while South Bend requires most rentals to pass a rental safety inspection.
- Short-term rentals in Indianapolis: Each short-term rental unit needs its own permit, renewed every year. The first permit costs $150, and state law doesn't allow a fee for renewals (Indianapolis Code ch. 852; IC 36-1-24-13).
- Statewide tenant rules: Cities and counties can't regulate tenant screening, security deposits, lease applications, lease terms or the fees a landlord charges; state law covers those. (IC 32-31-1-20)
What Indiana rents look like
The median Indiana renter paid $1,104 a month in 2024 and the median owner-occupied home was valued at $243,500 (US Census Bureau), about $13,248 a year in rent, or roughly 5.4% of value. That is a statewide gross figure before taxes, insurance and repairs, not a yield on your deal; the rent vs. home price page ranks every state.
Investing in Indiana from another state
In Indianapolis the registration needs a manager who lives in Indiana, so line up a property manager before closing. The loan doesn't care where you live, since a DSCR loan is qualified on the rent; we begin with a valid ID, two months of bank statements and a soft credit pull. Our staff handles the loan paperwork and the appraisal.
Indiana investor questions
How much can an Indiana city charge to register a rental?
No more than $5 a year under state law.
Will the property tax go up when I turn a house into a rental?
Often, yes. The cap is generally 1% of gross assessed value for an owner's homestead and 2% for a rental, and referendum taxes can push a bill above either cap, so the seller's bill can understate yours.
Do Indianapolis short-term rentals need a permit?
Yes. Each unit needs its own permit, renewed every year, with a $150 fee for the first permit and no renewal fee.
Can I own an Indianapolis rental if I live in another state?
Yes, but the city registration has to name a manager who lives in Indiana.
Have an Indiana deal? Let's talk it through.
Get a quote online or call our team.
