I have owned my baby yorkie "Billie" since July 28th, 2006. When He arrived, we had everything for him (his bed, crate, bowls, toys, etc.).
The first three days, I slept in the family room so I can supervise him and make sure He used his pee pads and did not get in trouble at all. After that, I put his crate in the family room during the day. At night time, I put his crate in my bedroom by my bedside. He stays quiet in there and does not wake up until I do. Now, after being tired of moving the crate back and forth I purchased a portable crate that looks like a tent, and He loves it too. He stays there like in the other one.
Do not place the litter box with pee pad in the crate. This will confuse him and he will start pooping and peeing in the crate. The crate is meant to be his den, so do not place food or pee pads in it. Also, the crate can not be a big size, it has to be just the enough size that he can stand up and turn.
Hope this help.
Bianka