Good pay. Control over your hours and benefits. Less time behind the wheel — and more time with your family. There are many reasons to become a freight broker, especially if you have a history of working in the trucking industry. According to payscale.com, freight broker salaries can range from $30,015 – $72,756, and a majority of brokers report being highly satisfied with their jobs. If all this sounds good to you, we’ve got good news: applying for freight broker authority may be easier than you think. Here’s how:
First, apply for your USDOT (Department of Transportation) number.
You’re going to need it on a lot of other applications, so it will speed things up if you get it ahead of time.
Next, register with the Federal Motor Carrier Safety Administration (FMCSA).
You’ll need to fill out the OP-1 Application for Motor Property Carrier and Broker Authority, to receive your MC number or FF number. There is a $300 filing fee that must be submitted, along with your application. You can file in one of three ways:
Online: You must have a credit card to process your online application. However, this method is faster than others.
By Mail: You can complete and print your OP-1 form and mail it to the address on the form, along with payment. This method doesn’t require a credit card, but it is a bit slower.
By Phone: You can request the form by calling 1-800-832-5660. It will be mailed to you, and you can then complete it and return it by mail. This option is good for people who don’t have Internet access, and/or aren’t comfortable using the Internet. However, it’s also the slowest method. It can take up to four weeks to process your application by mail.
Obtain a Surety Bond and apply for proof with the FMCSA.
Freight brokers are trusted by both shippers and carriers — so it’s essential that you’re properly insured. This protects you and your customers. In the event that a shipper is unable to pay for a shipment, the freight broker is responsible for paying the cost. And, if you’re unable to pay, your Freight Broker Bond (BMC-84) will act as insurance, covering the expense. To apply for a bond, you’ll need to submit an application to a reputable insurance firm, which will conduct a background check and credit check. The cost to obtain surety bonds for freight brokers may range from $1,800 and $10,000 a year, for $75,000 of coverage. Once you receive coverage, your insurance provider will need to provide proof of that coverage to the FMCSA.
Designate a Process Agent.
Within 90 days of receiving your MC or FF number, you will be required to designate a process agent for any state in which you will do business. This will be someone who represents your company and can receive documents in the event of legal action.
Receive your License.
Step 5 is the easy one — and it’s also the most exciting. It’s a great day when you receive your License of Operating Authority. This means that you can begin doing business as a freight broker. Welcome to the world of Logistics. We wish you a safe and successful journey.
Want to learn more about being a freight broker? You’ll find lots of information on the Triumph Business Capital blog. We can also help you access capital funding to grow your new business, through our invoice factoring services. Want to learn more? Give us a call.