Indiana guide
Indiana special assessments
Special assessments are how deferred costs in an Indiana association arrive at your door, and they are one of the state's signature buyer risks. Indiana statutes do not impose a uniform owner-vote threshold or cap on special assessments — they are governed primarily by the declaration and bylaws, so boards generally may levy specials for unbudgeted capital needs subject to whatever vote and notice the governing documents require.
Indiana has no super-lien — if a unit's bank forecloses, the association's unpaid back assessments are wiped out and reallocated to paying owners. A high delinquency rate is a real distress signal.
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Indiana urgency: Indiana has no super-lien — if a unit's bank forecloses, the association's unpaid back assessments are wiped out and reallocated to paying owners. A high delinquency rate is a real distress signal. Data current as of June 13, 2026.
This light statutory treatment, combined with weak reserve law (no HOA reserve mandate and no condo funding standard) and frequent storm losses, is why surprise specials are a leading Indiana complaint. The marquee example is Conner Creek in Fishers, where a community reportedly holding about $140,000 in reserves faced a proposed $3.5M loan and large per-owner specials. Two structural pressures make Indiana specials especially likely: underfunded reserves against aging stock, and the fact that Indiana is not a super-lien state, so unpaid assessments often go uncollected in a first-mortgage foreclosure and are spread to paying owners. No statute forces disclosure of an approved or pending special on resale, so they are a core diligence item.
Why Indiana specials are common
Indiana condos face no reserve funding standard and HOAs no reserve mandate, so many associations carry reserves that are statutorily compliant but inadequate against a realistic capital schedule. On older Indianapolis-metro buildings with end-of-life roofs, masonry, and parking decks — and with hail and tornado losses driving roof and envelope claims — the gap between thin reserves and large capital needs closes through special assessments, often after a storm reconstruction shortfall that IC 32-25-8-11 expressly contemplates.
No statutory cap; check the declaration
Indiana imposes no statutory cap on the size of a regular or special assessment, and no uniform owner-vote threshold for specials — limits come only from the declaration and bylaws. Read the governing documents to understand what the board can levy without a vote and what requires owner approval. Note that for HOA budgets, IC 32-25.5-3-3 sets a no-quorum fallback ceiling (100 percent of the last budget, or 110 percent if authorized), but that ceiling applies only when quorum fails, not to special assessments.
Borrowing limits and the loan-vote trigger
Under IC 32-25.5-3-5, an HOA may not borrow more than the greater of $5,000 or 10 percent of the prior year's budget in a calendar year unless the loan is approved by an affirmative majority member vote, conducted by paper ballot distributed at least 30 days before the count, with narrow emergency and enforcement exceptions. A large loan in lieu of an immediate special — exactly the Conner Creek dynamic — is itself a signal of capital strain. Review any outstanding debt and confirm large loans followed the paper-ballot procedure.
The no-super-lien pressure
Under IC 32-25-6-3 the association lien is subordinate to property taxes and the first mortgage, and a first-mortgage foreclosure wipes pre-foreclosure assessments, so unpaid dues often go uncollected and are spread to paying owners. A high delinquency rate or a heavy count of recorded liens is therefore a leading indicator of future specials in Indiana. Read the delinquency report alongside the reserve balance and the master-policy deductible to gauge the likelihood that owners will absorb the next large cost.
Indiana legal references
- IC 32-25-8-11 — Insurance; reconstruction; insufficient proceeds
- IC 32-25.5-3-5 — HOA borrowing; member approval
- IC 32-25-6-3 — Unpaid assessments; lien priority; no super-lien
Informational only. Not legal advice. Always confirm against current statute and counsel.
Need help applying these Indiana statutes to your specific situation? We can connect you with state-licensed counsel and specialists familiar with this exact regulatory environment.
Find a Indiana specialist →Reviewer's checklist
- Request the special-assessment and loan history for the last several years
- Ask directly about any approved or pending special assessment
- Read the declaration for any owner-vote or notice requirement on specials
- Obtain the reserve balance and read it against large near-term capital components
- Review the master-policy wind/hail deductible and claims history for storm-shortfall risk
- Review any HOA loan for the IC 32-25.5-3-5 borrowing cap and paper-ballot requirement
- Check the delinquency rate given Indiana's lack of a super-lien
- Review recorded association liens and any foreclosure actions against units
- Read the minutes for assessment or loan discussion not yet formally levied
- Weigh the cumulative special-assessment risk against your budget
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We read the reserve study, operating budget, and 24 months of meeting minutes together — indiana special assessments risk usually lives in the contradiction between documents, not in any single one of them. Every finding cites the source document, the page number, and the quoted text behind it.
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Related risk areas
Read these next to round out your due diligence
Reserve studies
A reserve study tells you what the association expects to spend on long-term capital repairs and replacements, and whether it is funding those obligations adequately.
Condo document review
A condo document review is the structured analysis of every disclosure document your seller or association has provided — declaration, bylaws, rules, reserve study, budgets, financials, meeting minutes, insurance summary, estoppel or resale certificate, and any pending special assessment notices.
Insurance risk
The association's master insurance policy determines what your personal HO-6 policy needs to cover — and what it does not.
Reviewed by Kirk Hasley, Founder. Every claim here is checked against current Indiana statute and primary sources, using the same documented review framework we run on every file. Last reviewed June 13, 2026.
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A special assessment, an insurance non-renewal, a thin reserve study — find out whether it signals real risk, checked against your state's rules, with page citations you can verify. No cost, no obligation.
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We can connect you with insurance brokers, realtors, and mortgage brokers who can help you respond to what your documents reveal.
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