Answered by Robert MoreschiMarch 4, 2013
Great question, as this is a common misconception in the moving industry, but one that mostly serves to warn customers about potential scams that unscrupulous "moving companies" tend to carry out on unsuspecting victims. In general, it is not illegal for a moving company to ask for a deposit, but that doesn't mean it's common. In fact, it is highly uncommon to encounter a moving company that asks for a deposit up front.
In most cases where a deposit is requested upon booking a moving company, the deposit is for a small amount (usually no more than $100) and is used as a type of insurance for the moving company that the customer won't bail and cancel the booking on the day of, costing the company money in lost time. Also, some customers will book with a moving company to receive free packing supplies from them leading up to the move and then cancel just days before their moving date. So in these cases, the deposit is to protect the moving companies from these cancellations.
However, when moving companies do request a deposit, they are never for more than a few hundred dollars at the absolute most. The biggest red flag to look for when booking a moving company is one that asks the customer to put down a large sum of money before the move. These companies are most often operating a scam. So beware, if you are booking a moving company that is requiring you to pay half of the total moving costs upfront, then it is likely that you are dealing with a moving broker, not an actual moving company, and there is a possibility that you are being scammed. An honest and reliable moving company will never require you to pay a large amount of money as a deposit before the move ever takes place.
When hiring a moving company, it's important to do the necessary research on the background of the company to make sure that they check out, and also be sure to ask the movers any questions you may have about the moving process before you make your choice.
To learn more about the different kinds of moving scams and moving fraud that takes place in the moving and relocation industry, check out our moving guides page to read up on everything moving related.
Also, if you've dealt with a dishonest moving company and want to warn others about it, visit our moving reviews page and tell us all about your moving experience.