Moving Brokers Laws & Regulations
It’s great to find a variety of options online when you want to get the best moving company that will be able to respond to your needs. However, there is a better way to make the decision making process easier by contacting a moving broker. Before we dive into moving brokers laws, let’s start at the beginning shall we?
What Are Moving Brokers?
Take note that moving brokers do not provide the services themselves. Moving brokers are not responsible and authorized to transport your household goods. Moreover, you do not have professional movers or moving trucks. Likewise, interstate moving brokers are required to contract movers that are registered with the Federal Motor Carrier Safety Administration (FMCSA).
Working with A Broker
There are requirements for a moving broker that clients need to be cautious about. If you are going to book your move, it is important that you ask the company if you are actually a mover or a broker. So as a moving broker, you should have the following requirements.
- Registration with the FMCSA
- A booklet from the FMCSA to be given to you titled “Your Rights and Responsibilities When You Move” and the brochure titled “Ready to Move”
- Offers a list of moving companies that you are using
- Use only the movers that are FMCSA registered
- The movers that brokers are using must also have a written agreement with them
- Non-binding or base biding estimates on the tariff of the mover transporting your shipment
- Advertising reference to their physical business location, status as a broker, and MC number, stating that you are not transporting household goods but only arranges for the service
- Requires a mover transporting your goods to do a physical survey of the household goods if located within a 50-mile radius of the agent’s or mover’s location. However, you have the option to waive the requirement
- Follows all moving brokers laws diligently
- Have a high risk merchant account in good standing
A search tool can be used from the FMCSA website to determine if the broker or mover is duly registered. You can also check the complaints history from within this website.
Basically, moving brokers act as middlemen to help you get connected with moving services. Brokers are also there to arrange the move for you. So moving brokers provide the moving estimates and will assist you in booking with the best moving company.
Your skills as a broker usually come directly from your ability to negotiate for the price on behalf of clients and arrange for the required logistics. Even so, you will still have to go through some legal and regulatory audits before operating. In this case, you should be regulated by the FMCSA in which you need to be registered before you can arrange moves. At the same time, you should have a valid DOT number.
- Licensing and audits – brokers like you will be regulated by the FMCSA to be able to arrange a move for clients.
- Insurance – you will usually offer insurance but may cover the entire value.
- Geographic coverage – you are able to access wider serviced routes through a network of movers.
- Customizable solutions – you should be able to arrange for any service that you require.
- Cost – The cost will include the service fee of that you will charge that usually sums up to 20% to 40% of the move cost.
A moving broker is the perfect middleman. Taking the hassle out of moving for customers while finding sales for moving companies. Get your negotiating skills up and break out your book of contacts. You’re going to be on your phone making deals and hustling all day. Moving brokers laws are the least of your daily concern or should be, if you have created a smooth on boarding and payment process.
High Risk Merchant Accounts
Moving broker merchant accounts can be tricky to say the least.
Banks provide some insight into what they consider a high-risk merchant account. The truth is that only a qualified high risk merchant account provider can tell you what consistutes high risk, and ultimately how to avoid so many of the pitfalls related to that status. These are some of the following reasons moving brokers are considered high risk accounts:
- High chargeback or fraud rate: Moving companies are, unfortunately, an industry that has its fair share of chargebacks or outright fraud. This judgement is not based on an individual level but on teh industry as a whole. There are many local moving companies that have created a pattern of chargebacks that banks will no longer tolerate without insurances.
- Broken promises: Moving companies often quote prices that are lower than the final price and show up late. Stressed customers will almost always complain and some will go as far as to put stop orders on down payments. This, again, leads the banks to judge the industry as high risk as a whole.
- Questionable sales and marketing practices: The moving industry is filled with scammy, shady, and just all round bad business types.
- High average ticket sales: Moving businesses routinely accept unusually high-cost purchases via credit card. Each transaction can be as low as $900 to as high as $10,000 so each cancelled, stopped or refunded purchase is no small chunk of change.
Finding a merchant account is a necessary part of the business. It doesn’t have to be difficult, it just has to be done.