How to Bid on Storage Units
Thanks for checking out Lockerfox for online storage auctions. This article discusses some things you should know before bidding on units. In the sections below, we'll talk about:
3. Why does a certain unit keep getting cancelled?
4. What is a distance limit and how to request an increase
5. What is a leaderboard limit and how to request an increase
Please read through these sections to make sure you understand these things before bidding.
How proxy bidding works
Many bidders just want to set a maximum bid on a unit and not pay attention to it for days until it ends.
Proxy bidding takes care of this for you. Let's say a unit is at $40, and you're willing to pay up to $100 for it. You can place a proxy bid for $100, and you'll become the leader at $50. Then, if other bidders try to bid, they will bump up your proxy bid to your maximum of $100, and eventually take the lead at $110. So, if nobody else wants that unit, you'll end up winning it for $50, and your proxy bid (max bid) will never be used.
It's important to understand what happens if another bidder "pushes up" a proxy bid. In the example above, another bidder might place a bid for $60, but they won't take the lead because of the pre-existing proxy bid that will keep you in the lead until it goes over $100.
In the bid history shown below, you can clearly see Larry7's initial proxy bid being pushed up by jherring, who eventually takes the lead at $210.
It's important to remember that for a popular unit, your proxy bid will almost certainly get pushed up by other bidders. You must be prepared to purchase the unit if you get pushed up but ultimately you remain the leader and win the unit. The Lockerfox site or our team does not, ever push up proxy bids. All bumps are in response to actual other users attempting to bid.
What is a manager's unit?
Some units may be shown as a manager's unit. These units are a separate process from lien units and it's important to understand where they come from and when you should bid on a manager's unit.
Most units are lien units, which means a self-storage tenant failed to keep their account current and the facility has overlocked the unit, denied the tenant access, and are selling the contents to recover their lost rent. These units contain all the goods as they were, at the time of overlock. It's no guarantee there are valuable items, but there's certainly the chance.
A manager's unit (sometimes called a build-up unit) is just a collection of items that the storage facility needs to get rid of. This can be items left behind by cherry-picking winners (who will get suspended on Lockerfox, btw) or just any items the facility needs to get off the property. We've even seen a facility sell their old golf cart online this way.
A manager's unit isn't going to contain any hidden treasures. The goods belong to the storage facility and are being sold. They might even be items the tenant voluntarily signed an abandonment for, which means the storage facility doesn't need to follow the legal lien process.
Only bid on a manager's unit if you see items you want and are happy with their condition regardless. As with all units, never assume anything (lawn mower, generator, etc) works or runs.
Why does a certain unit keep getting cancelled?
Once in a while you may notice the same unit coming up online, getting cancelled, and coming back online again. This can happen for lots of reasons, and we agree it's frustrating. Often times it's because the tenant pays their bill current, but gets behind again right away and falls back into delinquency. Sometimes, the facility takes a partial payment with an agreement to pay the overdue balance by a certain date. If that date comes and goes, they post the unit again.
Here's another one: The facility won't sell a tenant who's in bankruptcy and because of the long legal process (60 days+ in most states) they start the process but then are made aware the tenant is possibly in bankruptcy. They cancel the unit, and subsequently get clearance that it's not a bankruptcy, so they post the unit (again). Then the tenant pays, but is late again the next month and the cycle repeats.
Cancellations are frustrating. In most cases, it's really just the facility trying to work through the process, often with a habitually late or unreliable tenant.
What is a distance limit and how to request an increase
Facilities post units for auction as the final step in the legal lien process. By the time a unit actually goes up for sale, the tenant can be 60-100 days late (depending on the state) and can owe hundreds of dollars in back rent. The facility counts on the winner to show up and empty the unit, so it's available for a new tenant. Buyer no-shows throw a wrench into the whole process.
All kinds of people sign up to bid on units. Some are professionals, some are weekend warriors, and some are opportunists who see what looks like a great deal hundreds of miles away. Once the excitement of winning wears off, the reality of picking the stuff up, and making sure it will fit in one trip, and getting the help and the truck and the time... Well.... Screw it. Not picking it up.
We've seen this play out countless times over the years. Thus, Lockerfox has a 180 mile distance limit for new bidders. Once you have a track record of picking up units, we're happy to grant an increase. Just contact us and we'll take care of it.
What is a leaderboard limit and how to request an increase
Just like the distance limit, the leaderboard limit exists to protect storage facilities from having someone with no track record put a bid on 8 or 10 units and end up winning a bunch, and then not picking them up. That would create a huge headache for the facility and for the Lockerfox support team. If you're a buyer with a good track record with Lockerfox, contact us and we'll take care giving you a leaderboard limit increase.
Like the distance limit, the leaderboard limit exists in response to the facility's need to have the online auction process run with minimal disruption.
We hope you enjoy bidding and winning on Lockerfox
Thanks for reading. We hope you'll like using Lockerfox and we're working hard to onboard more storage facilities to increase the supply of units. Happy bidding!
Click here to learn even more more about How to get started buying storage auctions.
