Myths and Truths of Becoming a Freight Broker
License Requirements, License Procedures, and Freight Broker Training
Myth # 1:
You need expert representation (such as a DOT practitioner, lawyer, accountant, etc.) to file for motor carrier and/or property broker authority.
Truth:
The applications you need in order to file for a motor carrier and/or property broker license are readily available at the Federal Motor Carrier Safety Administration’s website. Instructions on completing this online registration is provided by the FMCSA, and if additional help is required, you can contact the FMCSA directly.
Myth # 2:
An expert can get your broker’s license faster than if you file yourself.
Truth:
No matter who files for your freight broker registration, you will be given a pending US DOT number instantly. That US DOT number will be activated by the FMCSA once your registration application has completed the approval process, which includes: a 10-day waiting period, you meeting the additional FMCSA requirements (such as providing proof of financial responsibility and designating a process agent), and the FMCSA reviews and approves your application. The FMCSA has a specific procedure for accepting and processing registration applications and there is no special filing method that can make this sequence of events happen any faster.
Myth # 3:
You can pay only $1000, or even less, for freight broker training that includes your freight broker license. And, once you complete your course you'll be a licensed freight broker.
Truth:
Becoming a licensed freight broker is not as simple as completing one application and paying one low fee. There are multiple steps and fees. The FMCSA will NOT approve your freight broker license registration application unless you have also posted a BOC-3 Form and secured either a $75,000 surety bond or a $75,000 trust fund. Once your freight broker license registration application is filed, you have 90 days to meet the BOC-3 and insurance requirements. If those requirements are not met within 90 days, the FMCSA will DENY your license application.
Bottom line: the total cost to obtain an approved freight broker license registration and active US DOT # is higher than $1,000. Why would any school or business train you for negative money? Most likely, the truth is the freight broker training price actually includes the license filing service fee only (a value of about $150). And, after you complete the training, you will still be responsible for the FMCSA's $300 application fee, the BOC-3 form ($25 to $150) and the initial annual premium or fee regarding your surety bond or trust fund ($1,000 to as much as $12,000, depending on your personal credit and business experience).
Myth # 4:
You can learn to be a freight broker in as little as four to eight hours of training.
Truth:
What other profession can you learn to do with one day’s training? Freight brokers are professionals registered by federal government to operate as a property broker within the United States. As a professional, you are expected to be knowledgeable in every aspect of freight brokering. There is no way any training program can teach you to be a successful freight broker in just a few hours. If it sounds too good to be true, it probably is.
Myth # 5:
You can learn to be a successful freight broker through an internet or home study program.
Truth:
With today’s technological advances, it’s very possible that you may be able to learn as much from an online course as you would from an in-classroom course. This, however, all depends on the method in which the course is presented how, as well as how YOU learn. An online course that can utilize multiple methods of learning, such as hearing, observing, reading and writing can be extremely effective for most people. But, for those who learn best with hands-on instruction or face to face interaction, there is absolutely no substitute for an in-classroom learning environment with an experienced educator and professional broker. In addition, a traditional classroom setting allows for questions and input from fellow classmates and generally prompts further discussion, which can be invaluable. And, of course, being able to ask the instructor questions yourself and receive immediate feedback is another advantage of attending an in-classroom course.
Myth # 6:
An instructor who is not actively engaged in brokering freight can provide you with practical and up-to-date knowledge about the industry.
Truth:
Actual experience is absolutely needed in order to effectively teach others how broker freight. Not only should your instructor have several years of experience brokering freight, but they should also still be currently working within this industry in order to ensure their curriculum and lessons are still relevant. All instructors at FMS are actively involved in brokering freight. This provides our students with the advantage of receiving the best education possible. Therefore, we at FMS believe that before you invest your hard earned money in a freight broker training program, you should ask for the name of the brokerage (and its’ US DOT number or MC number) with which the instructor is affiliated. You can verify whether or not a brokerage has an active FMCSA registration or authority (using its US DOT number or MC number) through the Licensing and Insurance section of the Federal Motor Carrier Safety Administration’s website.
Myth # 7:
The ability to teach requires no formal training.
Truth:
Teaching is a skill that requires formal training. It requires well developed skills in curriculum development, lesson preparation, lesson delivery, and appropriate evaluation. All instructors at FMS hold college degrees and have extensive classroom training experience.
Myth # 8:
There are different levels of broker certification (i.e., Master Broker – Diamond, Platinum, Gold, or Journeyman Broker, - Silver).
Truth:
There is only one level of freight broker certification. The official term is Property Broker Registration and you either have an active registration to operate as a Property Broker or you don’t. No matter how many schools you attend, courses you take, money you spend, or years you work, you are still a Property Broker. A more common term used is Freight Broker. The Federal Motor Carrier Safety Administration (FMCSA) does not recognize any other title than Property Broker. You can contact the FMCSA at 1-800-832-5660.
