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Lien and Auction Schedule Requirements

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  • Lien and Auction Schedule Requirements

    I run a facility in Arizona. My company's corporate office is in California and some of our practices lean a little towards the California requirements. I've googled Arizona self storage lien law and read a fair amount of info. I am not a member of AZSA, so I don't have access to their info or forms. I'm wondering if anyone could provide a break down or a link to a break down of minimum requirements for late fee dates, notice of default, auction dates, etc. My current procedure is as follows.

    1st rent due for everyone
    (10 days late) late fee (I know Arizona only requires 5, but corporate chose a 10 day late fee assessment)
    (20 days late) 1st notice of default (sent via certificate of mailing)
    (40 days late) 2nd notice of default (sent via certificate of mailing)
    (55 days late) Unit sold at auction

    There is a ton of lien law info. Some of it is outdated and can be a little overwhelming sometimes. During a meeting someone mentioned Arizona in the future may no longer require certificate of mailing for notice of default letters and an email would suffice since it can be tracked. I've had a couple customers recently tell me they can't pay and intend to abandon the unit, but never came in to fill out a notice to vacate form so I could sell the unit sooner and re rent it. I'm stuck sending notices for almost two months on a unit that I know they won't pay on. I would like to expedite the auction process, mostly for customers that I feel we have little or no chance to collect on. Also, for you AZ facilities. Do you charge an additional late fee on the 2nd month as well, or just the 1st month of late rent? My setup only assesses a late fee for the 1st month, even if it takes 3 months to finally auction the unit.

  • #2
    I would follow the AZ statutes to the letter to avoid any problems. Document everything, including the part about abandonment and tenant not signing the notice to vacate form. If you can advertise, and auction a unit in 2 months or less, that is a decent turnaround time. Make it easy on yourself by doing the auctions at a web site.
    "Never let the inmates run the asylum!"

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    • #3
      Originally posted by pacnwstorage View Post
      I would follow the AZ statutes to the letter to avoid any problems. Document everything, including the part about abandonment and tenant not signing the notice to vacate form. If you can advertise, and auction a unit in 2 months or less, that is a decent turnaround time. Make it easy on yourself by doing the auctions at a web site.
      Thanks Pac. Two months isn't too bad. If I can cut that time almost in half, I have to check it out. I was looking at the Arizona legislature site. It feels like the site only gives you part of the answer. It states units can be sold if in default for 30 days. It states you are required to send two notices of default no less than 7 days apart, but doesn't state when the first one needs to go out. The time frame I use now, more than covers us. I'll keep digging around the interwebs and see what I find.

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      • #4
        I personally think the statute, while convoluted, says it all. The unit is in default as soon as the rent is late and can sell 30 days after the day it is late. Whether you put a lock on the unit on that late date or lock the gate on that late date, it is in default when late. If a definition of the state's idea of default is in those statutes, I would read it thoroughly.

        As I read it, you can send the first notice the next day after the rent is late and 7 days later. During that time you can cut the lock, for a fee, and take pics, depending on what your lease states. All of this still has to be tailored to what your lease says.

        IMO, you could literally sell the unit at the end of the 30 days in default. I would assume that would be about 1.5 months after the day the rent was originally due. During that time, if you use a web site, your pics could be being shown and looked at at that site. Way more than the quick look before a live auction when you just opened the door.

        All of this is in my opinion. What do you think?
        "Never let the inmates run the asylum!"

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        • #5
          Convoluted is the key word. Thank you for your help man, I appreciate it. I will be talking to my district manager about this. Hopefully we can trim some fat out of our process.

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