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Lien Sales and Covid

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  • Lien Sales and Covid

    I have a tenant who consistently goes delinquent for a couple of months. After the proper notices are served he will finally catch up. He has been doing this for years. Right now his unit is scheduled for online auction to end January 26. We have spoken to him recently with no mention of Covid; but today he calls to say he has Covid. He is already 5 months delinquent and says he knows "we don't HAVE TO auction his unit because he always ends up paying." I am a little frustrated right now and am wondering if the Covid protocols are such that we can go ahead and continue with the auction? We are located in Minnesota and I have not found any clear information at this time. Thank you!

  • #2
    I would contact the MN SSA to make sure. There are differing laws by state.
    MamaDuke

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    • #3
      In AZ we have no protocols for Covid, my boss did let me know at the beginning of all this, I could help people etc.. BUT I had a customer as you described above. She had not paid since OCTOBER pre covid, I am sure anyone that saw my on line auction as maybe I had no feelings, I auctioned her. But she had never paid after she moved in. I felt bad, but I did it. she never contacted us or anything. In your case though, I would tell him you need to pay or it goes to auction, and raise the rent. I have some people that pay once they hit 30 days, but if they were consistently late, I would raise the rent... they might try and pay on time if they know they get a rent increase when you have to work so hard for the money... You should check with your self storage association. Good luck....

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      • #4
        The "Have to" as far as covid is a state issue. I would stay the auction course and I would bet he pays.

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        • #5
          I am in NJ and we currently have no laws or any moratoriums that would forgive a storage tenants rentals.
          At the beginning of the pandemic we chose to waive late fee's if a tenant asked and we did pause auction sales but only because we felt it was right at the time.
          We have since been conducting lien sales and I would not pause any sale because someone told me that they are sick.
          I feel bad and all but they signed a lease agreement and I must adhere to the legal terms of that signed agreement.
          Good luck and keep us posted on what your plans are.
          Don't put off until tomorrow, what you can do today.

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          • #6
            I paused sales for a few months mid-2020 during the time our office was closed down. I resumed them shortly after re-opening with no issues. Not one person has used covid as an excuse, especially since they had "multiple" opportunities to pay before they got sick. As others said, check with SSA to make sure you aren't violating some state law, and proceed with the sale.
            Too many freaks, not enough circuses.

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            • #7
              What everyone is saying above. Also did your state ever have explicit rules regarding COVID to begin with? In New York it was a suggestion, and we all put auctions on hold because a) right thing to do and b) we didn't want an actual law passed.

              As an aside, we have a few people who consistently end up on the auction list. After over a year and a half of working with people my new policy is if this is your second time going to auction in less than a year, I'm raising you to street rate, which is usually a decent difference of $20-$50 more a month. (Side note: prices in our area shot up in the last year to ridiculous heights hence the difference). I'm all for working with people, and have several customers on payment plans and such, but when it becomes the expectation that they will receive special treatment because they always end up paying late I draw the line.

              This used to happen a lot before I got to the facility, where habitual tardy people were let into their unit even though it was overlocked, part of the auction fees were waived if they paid up, they didn't go to auction if they paid just some of the money due, etc. We've stopped doing that now and A LOT of our "problem children" have shaped up and pay on time or at least don't give us a hard time about fees when they are late. We have lost a couple, but they took so much time and energy to deal with that we probably came out ahead in the end.

              So if you want to keep him make sure it's worth your time and energy!

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              • #8
                Make sure your state doesn't have any laws against covid. People are using this as an excuse. We had a tenant move in back late last year and they paid once. Nothing since. They texted me and said they had covid and my response was something along the lines of this. I'm sorry to hear that but you have been delinquent for months now. Please get your account current to avoid being auctioned.

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                • #9
                  Thank you all for your comments & advice! I have not been able to find any laws in MInnesota concerning lien sales and Covid. My plan is to move forward with the auction because I am tired of dealing with this guy and his excuses. It is always good to hear input from other self storage managers - reminds me that I am not the only one dealing with a few "problem children".

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                  • #10
                    Originally posted by grcitylimits View Post
                    Thank you all for your comments & advice! I have not been able to find any laws in MInnesota concerning lien sales and Covid. My plan is to move forward with the auction because I am tired of dealing with this guy and his excuses. It is always good to hear input from other self storage managers - reminds me that I am not the only one dealing with a few "problem children".
                    Oh yes! Keep it moving and your delinquent tenant can kick rocks!
                    Don't put off until tomorrow, what you can do today.

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