Watch out for negligent and dishonest self-storage operators: Internet Scambusters #515
The U.S. has more self-storage facilities than all other countries in the world put together -- by a considerable margin.
Which means that although we have more places to store our surplus stuff, there are also more opportunities for unscrupulous unit owners to scam renters.
While most self-storage owners are honorable in their dealings, as in any business, there are also some crooked ones.
We've got the details on how the scammers operate and what you can do to protect yourself.
Now, here we go...
5 Most Common Self-Storage Scams and 8 Ways to Protect Yourself
Sooner or later it comes to many us -- the need to move surplus items from our overflowing homes into self-storage.
There are an estimated 60,000 storage facilities in the US, accounting for something like two thirds of the entire number worldwide.
We must have a lot more junk here than the average global citizen!
And although the self-storage industry does a great service in providing a secure temporary home for our unneeded "stuff" -- like most other business groups it also has its share of unscrupulous and shady characters who give it a bad name.
Self-storage scams come in many forms but if you are planning to put some of your possessions in lockup storage, here are the four most common ones to be on the lookout for:
Hidden or Additional Charges
This is probably the most common self-storage scam.
You rent a unit for a knockdown price, maybe even including a free month, but once you've moved everything in, the rent goes through the roof.
The owner knows you're probably unwilling to move everything out again, or you may have signed a contract giving him the right to raise the rates.
Alternatively, you discover additional charges for things like lock rental, insurance, late fees, utility surcharges, additional security -- all perhaps perfectly legitimate but never made explicit at the time you rented.
Neither Clean Nor Secure
Most self-storage facilities proclaim themselves to be secure and clean but a good number fall short of how you would probably define these terms.
Reported incidents include:
- Rat infestations including, in one case, rodent nests inside a sofa
- Leaking roofs leading to damaged contents
- Broken surveillance systems
- Unguarded and sometimes unmanned entrances, leaving site access open to anyone
- Poor security vetting of visitors
Complicity in Theft
In extreme cases self-storage operators, either through negligence or direct involvement, have played a part in theft of contents from lock-up units.
This may happen if they hold a master key to the locks, although crooked operators have been known to cut padlocks to gain access or allow others to do so.
Sometimes, they just turn a blind eye while units are rifled.
This is a difficult area to police because self-storage contracts usually give the facility owner a legal right to enter units and auction off the contents if the renter defaults on payment.
Hiding in the Small Print
Like most rental arrangements, taking a self-storage unit involves signing a contract.
This is an opportunity for unscrupulous owners to add all sorts of conditions relating to responsibility for your possessions, amount of notice for raising rents or quitting, and terms under which you're deemed to have defaulted.
In one example, a renter who had stopped using a facility several months previously was charged rent because he had left his own padlock on the unit.
Selling Your Stuff for Peanuts
If you do default, the owner is probably entitled to force entry and auction off the contents.
In some cases, renters claim they have been forced into default because the owners have made themselves inaccessible to receive payment.
Either way, the owner either is only interested in getting the overdue rent or is in cahoots with auction buyers who will buy your stuff for an outrageous price -- in one reported case $25 for thousands of dollars' worth of content.
8 Things You Can Do to Protect Yourself
The vast majority of self-storage units are everything they claim to be in terms of security, cleanliness and integrity.
But if you want to minimize the risk of being on the receiving end of a self-storage scam, here are 8 things you can do to protect yourself.
1. Research the facilities in your area. If you enter the name of the self-storage company in an online search, you will pretty quickly get any feedback on poor performance or alleged scams.
Search local media for reports of theft and other incidents. There have been isolated cases where people have been reported living in storage units.
2. Visually inspect the facility. Walk around, checking cameras and connected monitors, and look out for signs of poor cleanliness, such as piles of garbage from emptied units.
Check to see how many units are occupied. Low occupancy might be a cause for concern.
3. Always get a written contract and read everything, including the small print, before signing it.
Be particularly aware of key clauses concerning:
- Late payments and defaults
- How much notice you have to give and pay for if you quit
- The right of the owner to increase rents and terminate the contracts
4. Check if they are members of the industry's trade body, the Self Storage Association. This isn't a guarantee of integrity but the organization does enforce its own code of ethics.
5. Fully insure the contents. Many self-storage facilities offer their own insurance protection but shop around for the best coverage.
Whatever you choose, again read the small print. Some policies include "get-out" clauses if either you or the facility owner is shown to have been negligent.
6. Make a photo record of the contents and keep a written inventory.
7. Use your own padlock if permitted. (And don't forget to take it with you when you leave!)
8. If possible, regularly inspect your unit and report any concerns you have to the management in writing.
For the record, we should also note that both facility owners and some of the people who attend contents auctions have also been the victims of con tricks.
We'll leave that for another self-storage scams issue.
That's it for today -- we hope you enjoy your week!