*Feature image courtesy of Sparefoot*
Since the glamorization of the self-storage auction through the hit show on A&E, Storage Wars, storage auctions have hit a new frontier. There have been stories of huge success with units hiding secret treasures, the guitars of famous rock stars, suitcases full of cash or the other extreme- units just stuffed with trash.
While not every storage auction that you attend (online or in person) will end up as glamorous as they do on TV, it’s important that you know what you’re getting into before you become a storage stud.
First things first, how does a tenant’s unit go to auction?
Tenants use storage facilities to store their extra household items, old vehicles, a relative’s belongings, as a placeholder for a big move, if a loved one passed away, and for many other reasons. The common theme is that the majority of tenants use storage for items that do not hold an immediate need to the individual. For this reason, these tenants can sometimes tend to fall late on their payments. After several missed payments, the tenant’s belongings will fall into delinquency and the auction process will begin. It should be noted that by the time an individual’s property has gone to auction, there have been many formal attempts at communication with the tenant (email, text, letters, and phone calls) and there has been ample time to pay their delinquent rent. The tenant will only be contacted by the information that the facility has on file, therefore it is crucial that all of the information given to the facility is up to date and correct when renting. At this point, the delinquent property, or property that was left behind after a tenant moved out, can be sold to the public through an auction. The process of a storage auction is governed by state laws that control every step that a storage company should take.
Why do storage facilities do auctions?
While the business of selling others belongings may seem like a strange concept, the property that the items are being stored in belongs to the company and we are merely in the business of temporarily renting out this space. The second that a tenant stops paying their monthly bill, they jeopardize their belongings by not following the contract that they signed. Ultimately, not only will the tenant be losing money by not paying, the facility is also losing money by having that space sit and not be rented by a paying customer. It is a myth that storage facilities often make a profit from storage auctions. If the auction sale doesn’t cover the balance owed by the delinquent tenant, the leftover owed amount goes to a collection agency, if the auction brings in more money than the amount owed to the facility, by law, the excess is sent to the delinquent tenant. Contrarily, our facilities rarely profit from these auctions- the predominant reason for auctioning off the belongings is to clear up space for the unit to be re-rented since the previous renter did not follow up on the lease agreement.
The auction process is never easy for the site staff. If we had it our way, we would not have to auction anyone’s belongings and all rent would be paid. We understand that the units contain the personal belongings of a tenant and no one feels good about having to sell them. That is why we provide many opportunities to pay rent timely to avoid this.
Storage Auction Process:
The storage auction process can occur online or in person with the process beginning with clear facility rules laid out prior. The Trojan Storage online auctions occur on Storage Treasures. Here, you can find pictures of the interior of units and anonymous online bidders will place their bid. The unit will go to the highest bidder- just like an in-person auction. In an in-person auction, there will typically be an auctioneer unrelated to the facility, and groups of bidders will place their bids aloud unit by unit. No one is ever allowed to enter the unit- not the bidders nor the site staff- at any point; the auctioned units can only be viewed from the outside of the unit.
The unit has been won in auction, now what?
In both online and in-person auctions, the winning bidder will have 24 hours to either remove the belongings or take on the rent of the storage unit. If they do not do either and do not come to the site to pay, they risk forfeiting the bid and the unit will go back to auction. Most facilities require cash payment only for the units, some will take credit card payments- this is an important factor to be aware of prior to attending an auction.
Storage Auction Complications:
- Trojan Storage strongly suggests that the successful bid winner returns all personal items to the facility office. These items consist of personal photographs, legal documents, forms of identification, etc.
- Once auctioned off, the belongings in the unit legally belong to the bid winner and the previous delinquent tenant has no legal right to the items.
- Once paid for, the items in the unit are sold to the bid winners “as is,” therefore the bidders should be well aware of the content and value of the unit.
Check out Storage Treasures for our storage auctions.