Understanding Storage Auctions, Liens, Lockouts

Published on 8/23/2021

Why do storage operators lock out renters and auction their belongings?

An unfortunate truth in self storage is that sometimes renters don't pay their rent. Because storage operators rely on that rent to operate their business, operators are typically forced to take swift action to deal with nonpayment. It is in everyone's best interest to keep a renter in a unit, so operators really only exercise their right to auction off the belongings when it seems there is no other viable choice. Laws vary by state, but almost every state provides storage operators relatively quick relief in the case of unpaid rent.

What is the process for auctioning off a storage unit?

Laws vary by state, and operators have the option of being more lenient than the state allows. The first step is lots of communication. At Wildcat Storage Center, we will email/text a statement reminder several days before rent is due. After rent is due, two reminders are sent that the rent is late.  The first happens on approximately the 5th of the month and the second on the 10th. The second notice includes a late charge.  After several days of nonpayment another notice is created indicating that the unit has been locked out and the items will be auctioned off. This notice generally comes by email, but may also be mailed because the operator really doesn't want to auction off the unit, and so definitely wants to ensure you've received the notice. At this time an additional lock is placed on the unit door, and the renter no longer has access to the unit. In fact, if the renter does access the unit, it is considered breaking and entering! If the rent and any additional charges still have not been paid, an auction date is set and a final notice is sent to the renter about the pending auction.

What can I do if my stuff is going to be auctioned off?

By time it comes to this point, things have gotten pretty desperate for the storage operator, but it isn't too late to stop the process. The main thing you can do to stop your items from being auctioned is to immediately pay all back rent and late fees. If this isn't an option for you, you can try and call the storage operator to work something out. The earlier you call in the process, the more likely the operator will work with you. Why? Because as the process progresses, the operator expends significant time, energy, and money exercising the lien.

Does the storage operator make money on the auction?

Quite the opposite. The storage operator is legally required to only keep the money required to pay back rent, expenses, fees, and charges. If there is any excess left, which sometimes happens, it must be returned to the renter or sent to the state unclaimed property division. Typically, however, units auction for much less than is owed, leaving the storage operator with a net loss. There is really only potential downside for the storage operator in auctioning off someone's belongings, but the process still must be completed so that the unit can be vacated and rented to someone else.

How can I find out about auctions?

These days, most auctions are handled online. Large storage operators may hold in-person auctions because it isn't too difficult to queue up several units to attract many buyers. Smaller operators, such as Wildcat Storage Center, won't have as many units to auction, so it is simply quicker to do an online auction. You can do an online search for storage auctions and find several websites that offer this service. Many of these will allow you to sign up for notification in the case of an auction in your area.