Indiana Commercial Real Estate Loans: Judicial Foreclosure

Commercial property loans in Indiana use the same programs as every other state — SBA 504, DSCR loans, bridge loans, bank and life-company permanent loans. What Indiana changes is mostly in the mortgage and what happens after a default: closing charges set per document, a mortgage that cannot carry a power of sale, a three-month wait before any sheriff’s sale, redemption that ends at the sale, and a statute that makes a receiver mandatory on a leased building when the lender asks.

Closing costs: flat fees per document

Indiana’s county recorders charge by the type of document, not by the price, the loan amount or the number of pages: $25 for a deed and most other documents, $55 for a mortgage. When the property is sold, the buyer and seller also file a sales disclosure form with the county auditor, and the person filing pays a $20 fee. Some counties add their own charges — Monroe County, for example, collects a $10 auditor’s transfer fee per parcel, and Marion County may add a flat $10 per document by ordinance — so ask the title company for the county’s current schedule.

Example: a $2,000,000 commercial building bought with a $1,400,000 loan.

• Recording the deed: $25
• Recording the mortgage: $55 — the same at $400,000 or $14,000,000
• Sales disclosure filing fee: $20
• All together: $100

On the same example, Utah’s recording charges come to $80 ($90 in counties that add $5) and North Carolina’s deed excise tax is $4,000. Title insurance, the lender’s fees and third-party reports are still part of an Indiana closing; budget them with the commercial mortgage calculator.

Foreclosure: only through the court

Many states let a lender sell the property out of court under a power of sale in a deed of trust. Indiana does not: a mortgage of real estate, or any instrument with the legal effect of one, may not authorize the lender to sell the mortgaged property, and the sale may only be made under a judicial proceeding. Every Indiana foreclosure is a lawsuit that ends in a decree of sale carried out by the county sheriff.

The decree cannot be executed until three months after the complaint is filed, for a mortgage executed on or after July 1, 1975 (longer periods apply to older mortgages). After that, the party enforcing the judgment files a praecipe and the clerk certifies the decree to the sheriff, who must schedule the sale within 120 days. The sheriff advertises the sale once a week for three successive weeks in a newspaper in each county where the property sits — the first notice at least 30 days before the sale — serves a copy on each owner and posts the notice at the courthouse door. Before the sale, the party that filed the praecipe must pay the delinquent property taxes, special assessments and interest due on the property, or the sheriff cancels the sale.

Example: a complaint filed on March 2 cannot lead to an executed decree before June 2. If the decree is entered by then and the praecipe is filed when the wait ends, the first newspaper notice runs at least 30 days before the sale, so the earliest sale date is in early July — about four months after the complaint, and later whenever the court takes longer to rule.

Redemption ends at the sale; deficiency follows

Until the sale, any owner or part owner can redeem by paying the judgment, interest and costs — to the clerk before the decree goes to the sheriff, or to the sheriff after. Once the sheriff sells, the sale is made without any right of redemption and the sheriff delivers a deed to the buyer.

If the sale price does not cover the judgment, interest and costs, the sheriff levies the remainder on the defendant’s other property. The foreclosure chapter offers one way out, and it is a trade: with the lender’s consent endorsed on the decree, the owner can waive the three-month waiting period so the sale can go ahead at once, and the consideration for that waiver is the lender’s release of any deficiency judgment.

Example: the judgment with interest and costs is $1,460,000 and the property sells for $1,150,000. The unpaid $310,000 can be levied on the borrower’s other property — unless the owner waived the waiting period with the lender’s consent, which releases it. Whether a personal guarantee or a non-recourse carve-out reaches that amount is a question for your loan documents and your attorney.

Receivers: mandatory on a leased building

Indiana courts may appoint a receiver in any foreclosure, and on the lender’s motion the court must appoint one if the property is not the owner’s principal residence and any of these is true: the property is in danger of being lost, removed or materially injured; it may not be enough to pay the debt; the borrower or owner agreed to a receiver in the mortgage or another writing; someone not liable on the debt is in possession; the owner is not personally liable; or any part of the property is leased or intended to be leased. Nearly every income property meets the last test. The receiver takes possession, collects the rents and income, and applies them to taxes, assessments, insurance and repairs needed to protect the mortgage.

If a sale or refinance is your way out of a troubled loan, start before the lender files — once a receiver controls the rents, you no longer decide how they are spent. Use DSCR to see how far the property’s income has fallen short.

C-PACE: not available in Indiana

Indiana has not enacted a commercial PACE law. Bills to authorize one — SB 411 in 2023, SB 51 and SB 259 in 2024 — did not become law, and the Council of State Governments’ Midwest office noted in April 2025 that Indiana was not among the Midwestern states with a C-PACE law. Until that changes, energy and building upgrades on an Indiana property are financed inside the mortgage or with separate equipment financing.

Where to start

Choose the program — SBA 504 for an owner-occupied building, a DSCR loan or permanent loan for an income property, a bridge loan for a transition — and read the mortgage’s default, receiver and assignment-of-rents clauses, and any guarantee, before you sign. Size the loan with the commercial mortgage calculator. For financing that isn’t tied to real estate, the Indiana business loan guide covers SBA offices and state programs.

Ready to compare? Start a commercial real estate loan request — one application, compared across our lender network.

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Sources: Ind. Code §§ 36-2-7-10, 36-2-7-10.7; Monroe County Recorder fee schedule (in.gov); Ind. Code § 6-1.1-5.5-4 and Indiana Department of Local Government Finance, Sales Disclosure Form Overview (2025); Ind. Code § 32-29-1-3; Ind. Code §§ 32-29-7-3, 32-29-7-5, 32-29-7-7, 32-29-7-8, 32-29-7-8.5, 32-29-7-9, 32-29-7-10, 32-29-7-11; Ind. Code § 32-30-5-1; Indiana SB 411 (2023), SB 51 (2024) and SB 259 (2024); Council of State Governments Midwest, “Special property assessments, ‘green banks’ are among financing tools for states” (April 2025). Checked 2026-11-04.