Is there an auction solution?

rmason

Florida Statutes require a 75-day auction process from providing late notice to auctioning the unit.  On Day 38 of the process, we drill the lock and take pictures.  This is our first time to see what’s in the locker.  We find everything from a full locker to a locker with one or two items in it.  Last week we found a unit with six bags of landscaping stones.  Nice stones . . . but!  This is also the time we lose customer contact, i.e., phones aren’t answered, emails and letters returned.  So, we’re left holding the bag!  Sometimes, we feel like the local land fill.  Looking for solutions if there is one or two.  Someone suggested collecting first and last month’s rent.  Thoughts?

teamcapitola

What's your delinquency % compared to other nearby facilities?  is it significantly higher?

I've been told you can require whatever you want to rent, provided its applied universally and doesn't discriminate against a protected class. 

We could require first last, deposit... along with social security number and credit report.... and then realize that NOBODY will rent with us! 

I guess it depends on how bad your delinquency is versus potentially losing new customers to competitors.

For instance, we started requiring a valid state issued Driver License to rent (no passports or other ID), and while we do lose some business our delinquency % dropped in half! (from 4% average to right around 1.5%) We still have Auctions, but the number of defaulted units is much much lower. 

I do feel your pain; we had a unit at our last Auction that didn't sell...zero bids.. which meant I got to clean it out and take everything to the dump!

rmason

teamcapitola: Our delinquency rate is around .9%.  We have a very aggressive follow up program with calls, texts, emails, and letters.  Also have incorporated a local "third strike letter" for those who like to ride the auction roller coaster but never get to auction.  Third ride on the roller coaster is your last if you go past due on your account.  We don't offer to renew their lease.  Has been successful.

sonyawiprud

rmason said:

teamcapitola: Our delinquency rate is around .9%.  We have a very aggressive follow up program with calls, texts, emails, and letters.  Also have incorporated a local "third strike letter" for those who like to ride the auction roller coaster but never get to auction.  Third ride on the roller coaster is your last if you go past due on your account.  We don't offer to renew their lease.  Has been successful.

We have written in the agreement that we have the right to increase the rent to street rate if a tenant goes default, however my supervisor is too chicken to let me do it to my repeat offenders. I have a tenant with 4 large units, pays me close to $10,000 quarterly, pays at the very last possible second, begs me to stay open late for her to arrive with cash.....cries, and says she'll never let it happen again. We are sick of cutting her locks and processing for auction, we want her out but we feel it will cost us a lot to try and get her to leave, she definitely will not leave in a timely manner. On the other hand, it is $10,000. Stuck!

sonyawiprud

rmason said:

teamcapitola: Our delinquency rate is around .9%.  We have a very aggressive follow up program with calls, texts, emails, and letters.  Also have incorporated a local "third strike letter" for those who like to ride the auction roller coaster but never get to auction.  Third ride on the roller coaster is your last if you go past due on your account.  We don't offer to renew their lease.  Has been successful.

Just read this again and realized what you are saying is if they pay at the last minute before auction 3 times then we will evict them! GENIUS!! I will be putting this in my rental agreement and letting my repeat offenders know! 

helenatim

Repeat offenders    It's not the eviction notices, it's actually getting them to leave and take their stuff that is the problem.  They make that last minute payment the day of auction but you are still stuck with them.  Even with a Lease Termination notice, they just don't get that you don't want them anymore! 

skinman

I enjoy all the added fees and them never being able to access my facility. Late fees, cut lock and inventory fees..while I wouldn't want an entire facility of customers playing the game.. the couple that do doesn't bother me.

helenatim

skinman said:

I enjoy all the added fees and them never being able to access my facility. Late fees, cut lock and inventory fees..while I wouldn't want an entire facility of customers playing the game.. the couple that do doesn't bother me.

I get what you are saying here, but cutting locks and taking photos of units defeats my goal of never having to go to the facility!

GlenMark

rmason said:

Florida Statutes require a 75-day auction process from providing late notice to auctioning the unit.  On Day 38 of the process, we drill the lock and take pictures.  This is our first time to see what’s in the locker.  We find everything from a full locker to a locker with one or two items in it.  Last week we found a unit with six bags of landscaping stones.  Nice stones . . . but!  This is also the time we lose customer contact, i.e., phones aren’t answered, emails and letters returned.  So, we’re left holding the bag!  Sometimes, we feel like the local land fill.  Looking for solutions if there is one or two.  Someone suggested collecting first and last month’s rent.  Thoughts?

If we find units that we know wouldn't sell at auction (whether it be full of obvious junk or perhaps has a few items left, then we will deem the unit garbage, charge clean-up/disposal fees, and apply their deposit toward their balance owed. If the balance is still significant ($200 or over remaining), then we sent the tenant account to collections. Those tenants are also blacklisted from renting with us again.

MamaDuke7

GlenMark said:

rmason said:

Florida Statutes require a 75-day auction process from providing late notice to auctioning the unit.  On Day 38 of the process, we drill the lock and take pictures.  This is our first time to see what’s in the locker.  We find everything from a full locker to a locker with one or two items in it.  Last week we found a unit with six bags of landscaping stones.  Nice stones . . . but!  This is also the time we lose customer contact, i.e., phones aren’t answered, emails and letters returned.  So, we’re left holding the bag!  Sometimes, we feel like the local land fill.  Looking for solutions if there is one or two.  Someone suggested collecting first and last month’s rent.  Thoughts?

If we find units that we know wouldn't sell at auction (whether it be full of obvious junk or perhaps has a few items left, then we will deem the unit garbage, charge clean-up/disposal fees, and apply their deposit toward their balance owed. If the balance is still significant ($200 or over remaining), then we sent the tenant account to collections. Those tenants are also blacklisted from renting with us again.

Sadly, in California we can't do that.