New FMCSA Rules and what they mean for consumers
As of June 27, 2022, new Federal Motor Carrier Safety Administration (FMCSA) regulations may help consumers avoid common moving pitfalls.
These rule changes apply to brokers and asset-based moving companies that move household goods across state lines.
With moving scams on the rise and the last significant rule changes nearly a decade old, the timing couldn’t be better.
The FMCSA’s aims include:
- Increased fraud protection
- Improved consumer education
- Simplified paperwork
- A condensed and modernized version of the “Ready to Move?” publication
- Greater penalties for unscrupulous brokers and movers (minimum of $1,798 per civil violation)
Beefed-up consumer protections are long overdue, but will they help families on the move, or will nefarious movers and brokers find ways around them like they have in the past?
Let’s find out.
How the FMCSA developed the new rules
The FMCSA formed the Household Goods Consumer Protection Working Group to help with the rulemaking process.
Comprised of educators, consumer affairs specialists, and experienced moving industry representatives, the working group was tasked with improving how interstate household goods moving information is passed from motor carriers and brokers to consumers.
After soliciting additional input from industry organizations and the general public, the FMCSA received responses from:
- The American Trucking Association’s Moving and Storage Conference
- The International Association of Movers
- Unigroup’s MoveRescue (Unigroup is the parent company of United Van Lines and Mayflower Transit)
- One private citizen
Why the FMCSA’s new rules are so important
Thanks largely to the internet, the number of moving brokers has exploded in recent years.
It’s worth noting that brokers are transportation intermediaries. They don’t employ moving crews or have assets like trucks and warehouses. Instead, brokers act as “middlemen” between customers and traditional asset-based moving companies.
Though not inherently bad, the broker business model has a number of serious drawbacks.
In the past, moving companies and brokers weren’t always subject to the same regulations, and enforcement has been spotty.
In addition, brokers now commonly demand deposits exceeding 50% of total estimated move cost.
On the other hand, most traditional movers don’t require any deposits.
Worse yet, many brokers don’t have written policies regarding deposits, cancellations, and refunds, and if they do, they often keep them out of sight.
Movers and brokers that intentionally bilk unsuspecting customers out of deposits are collectively referred to as “deposit mills,” and many make significant portions of their annual revenue from this dishonest practice.
Thankfully, the FMCSA’s new rules address this issue and many more.
FMCSA rule changes at a glance
No more orders for service
Before the new rule changes, orders for service were among the most important of all moving documents. After June 27 they’re no longer required on interstate household goods moves.
In fact, the term has been eliminated from consumer protection regulations. All information previously included on the order for service should now be on the bill of lading.
Bills of lading are king
Bills of lading are legal documents issued by carriers (movers and brokers) to shippers (customers). New FMCSA rules require that bills of lading include all relevant move information, excluding that which remains undetermined like actual shipment weight.
To give consumers ample time to review bills of lading, they now must be provided, signed, and dated at least three days before the scheduled loading date.
Customers have the right to cancel their moves
In the past, last-minute move cancellations usually meant forfeiting deposits. Now, customers can cancel or “rescind” their moves without penalty, as long as it’s done within the three days between signing the bill of lading and their scheduled move day.
Within this window, customers can cancel moves for any reason or no reason at all.
However, deposits aren’t explicitly mentioned in the new rules.
Know your rights and responsibilities
Since orders for service are no longer used on interstate moves, carriers and brokers must now provide customers with a copy of Your Rights and Responsibilities When you Move at the time of the estimate.
When hard copies aren’t available, movers and brokers must provide clear links to the FMCSA website or show a clear and accurate reproduction of the document on their own website.
Either way, movers and brokers must obtain signed and dated receipts to prove that they’ve fulfilled this requirement.
Move changes must be documented
Customers add items or request services that weren’t included in the original estimate on many long-distance moves. In cases like these, movers and brokers must now prepare a new binding or non-binding estimate instead of simply revising the original.
These new estimates must be prepared before loading and include the date, time, and reason for the changes.
Just remember that new estimates don’t restart the 3-day clock for cancellation or recision.
Never sign blank documents
Savvy consumers rarely sign incomplete or blank documents, but it’s a common practice in the moving industry.
With the FMCSA’s new rules, customers cannot be required to sign blank documents. Customers may sign incomplete documents only when the missing information isn’t known or cannot be accurately determined.
For example, excluded information might include:
- Actual shipment weight
- Delivery dates (for customers who aren’t sure when they’ll take possession of a new residence)
Physical surveys are a must
Before the new rules, movers and brokers were required to perform physical surveys when the distance from their office to the customer’s residence was 50 miles or less.
Now, there’s no distance exemption, and physical surveys are required unless customers waive them in writing.
However, the definition of “physical survey” has now been expanded to include virtual surveys with video components that allow moving company representatives to see the customer’s items clearly.
Because of the video requirement, voice-only phone surveys do not constitute physical surveys.
What the new rules mean for consumers
The FMCSA expects the new rules to increase consumer protection by providing customers with clearer and more accurate information and estimates.
If so, moving scams should decline, and dealing with movers and brokers should become more transparent.
On the downside, shady movers and brokers won’t take these new rules lying down.
Many will find clever ways around them.
The best ways to protect yourself, your family, and your finances include:
- Getting personal referrals from friends, family members, and coworkers
- Listening to your instincts (this is huge)
- Just saying no to deals that seem too good to be true
- Being wary of movers and brokers that require big deposits
- Vetting potential movers with the Better Business Bureau (BBB)
- Checking each company’s DOT number
A final thought on moving deposits
Imagine moving your family’s fully furnished three-bedroom home from New York to California.
Imagine getting a $21,000 quote for a full-service move.
Imagine teary goodbyes with friends and loved ones.
Imagine giving a broker a $10,500 (50%) deposit before they’ve provided any services or loaded one piece of furniture onto the truck.
Now imagine that it’s 5 PM on move day, and you’ve just realized that the broker has more than $10,000 of your money and everything you own is on their truck.
Food for thought.
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