How to Get Your Freight Broker Authority

Q: What are the legal requirements to operate as a Freight Broker?

You must submit your Freight Broker Registration application to the Federal Motor Carrier Safety Administration (FMCSA) through their Unified Registration System. Upon receiving your pending US DOT number you’ll also need to meet the additional requirements of proof of financial responsibility by posting a $75,000 Surety Bond or $75,000 trust fund, filing your BOC-3, and filing a yearly Unified Carrier Registration.

Q: What's the difference in being a Freight Broker and Freight Broker Agent?

The first one works on his own, runs his company. The second one is an employee of a brokerage company and gets a commission percentage of the brokerage fee.

Q: Can I work at home?

You not just 'can' but you 'must' work at home at the beginning in order to save money, keep your expenses low while you grow and develop your business.

Q: What is a Freight Broker (Property Broker)?

Property Broker is the correct terminology for many names used in the business to identify what we do. Truck Broker, Freight Broker, Load Broker, Freight Agent, Transportation Broker or simply Broker or Agent are all interchangeable terms synonymous with ‘Property Broker’. An active FMCSA registration to operate as a Property Broker allows a third-party to arrange pick-up and delivery of a Shipper's product by a Carrier without ever having physical control of the shipment.

Q: Does a Freight Broker need a broker’s license specific to their state or in each state?

Freight Brokers are regulated by the Federal Motor Carrier Safety Administration (FMCSA). The Freight Broker registration with the FMCSA allows us to make arrangement for the transportation of freight anywhere within the United States. So, no, you will not need a separate freight broker’s license for each state.

Q: How much does it cost to apply for your Freight Broker Registration / US DOT # with the FMCSA?

The FMCSA charges $300.00 to apply for a registration with an operating status of a motor property carrier, motor passenger carrier, freight forwarder or freight broker. The FMCSA does require all new applicants to complete their registration application online through their Unified Registration system. No new applications by mail. If you’d like, a Freight Broker Training filing specialists will file for your Freight Broker Registration on your behalf with the FMCSA for $450.00 (includes the $300.00 fee charged by the FMCSA). Plus, our course graduates are eligible for one Freight Broker Registration filing service included in their course cost ($150 value, filing service does not include the $300.00 fee charged by the FMCSA).

Q: What is a BOC-3 and how much does one cost?

A BOC-3 form is provided by a process agent. It’s a blanket form of coverage that designates a representative in each individual state upon whom court papers may be served in any proceeding brought against a motor carrier, broker or freight forwarder. A BOC-3 form and filing is usually priced between $25 to $150, depending on the process agent providing the form.

Q: What is the difference in being a Freight Broker or a Freight Broker Agent?

A broker is the owner of his or her own company. They are required to meet all legal requirements (FMCSA Registration, Bond/Trust Fund, BOC-3) to operate as a broker. An agent works under the umbrella of the registered broker and typically receives a commission percentage of the brokerage fee.

Q: Is Freight Broker training school required?

Currently the answer is “Not yet”. Soon, the FMCSA will be establishing new rules requiring brokers to show proof of knowledge or have relevant experience. However, whether training is required by law or not, the reality is that the failure rate for those who attempt this business without freight broker training is high. In order for a broker to be successful in any industry (stock broker, real estate broker, etc.), formal training is a must. Freight Mover School will prepare you to perform broker duties in a profitable, ethical manner, giving you the tools needed to be successful in the field.

Q: Should a Freight Broker school be affiliated with a freight brokerage?

Yes! And the instructors should be actively engaged in brokering freight. How can an instructor teach something they don’t do themselves? When a school tells you they are affiliated with a brokerage ask for the brokerage name and US DOT # or MC # so you can check their FMCSA registration or authority and make sure it is current.

Newcomers in the field of business often ask themselves: “Why do I need a freight broker if I can negotiate it myself?” However, this profession is extremely important when goods are transported, and even more important is the experience of a freight broker, because the success of the transaction depends on him. But what qualities should such a specialist have and what should he know?

What Does a Freight Broker Do?

Freight broker is the middleman between cargo owner and carrier. With the help of a freight broker, customers will have no doubt that something can happen to the cargo. As he guarantees safe delivery at a certain time. The broker’s value of the consideration is the difference between what the shipper pays and what the carrier accepts as payment.

What are the Responsibilities of a Freight Broker?

The work of a freight broker includes the following elements:

to look for potential clients for the company;
to collect information about cargoes for the company;
to negotiate price and terms of payment;
to control and check the loading and transportation of cargoes;
to follow and report information about the transportation of cargoes to the client;
to take responsibility for solving urgent situations that arise during the movement of goods;
to ends the delivery process.

What Does It Take to Become a Freight Broker?

Education.

You don’t need to get an education to become a broker. But if you want to be demanded and competitive specialist, you will need a certificate of secondary education or GED.

It will be a huge advantage for you if you have a bachelor’s degree in business or in some related field.

Training and professional development.

Prepare before applying for a job by reading books or taking short online courses to help you understand the basics of a freight broker.

If the company hires you already as a freight broker, then you will most likely be trained and learn how to use the software (if you didn’t know how to do it before).

Obtaining the certificate.

In order to become a freight broker, you must obtain the appropriate license. However, one license will not be enough, so it is important that you also obtain other certifications in order to be more knowledgeable in this area.

You should understand that you can choose only one of two ways to work as a freight broker

There are two ways to become a freight broker: work independently and not depend on anyone or work as an employee in a company.

An independent broker enters into its own contracts with clients and receives payment directly from transactions with them.

Required Skills and Abilities.

Also of a great significance are the price beginner freight broker`s personal qualities, as follows:

broker always speak to clients and colleagues;
computer and technical literacy;
ability to negotiate with clients: agree on a price, solve a problem and attract new customers;
the market is changing all the time and the broker must adapt to the changes and develop more and more;
time-management;
problem solving skills;
social activity. From the first day of work, the broker should already be active and show his competence as much as possible;
emotional intellect. This ability will help you recognize the emotions and intentions of customers and lead to a successful transaction.

Conclusion

Regardless of whether you want to be an independent broker or work for a company, you need to have basic knowledge as in any other industry. After all, the success of the transaction depends on you, and if you are not professional enough, neither you nor your clients will benefit from this.