Sunday, May 14, 2006

Readers all over the internet are still in an uproar over Suze Orman's episode on App O Rama (you can see it on Youtube). At first, the segment seemed like she understood it - she explained how people make fortunes using other people's money, and how people can do a credit card App-O-Rama by applying for multiple cards at the same time, getting multiple signup bonuses, frequent flier miles, etc.

Suze showed how simple it is to deposit a 0% check into a high interest bank account, and how many thousands of dollars could be made from interest earned on that deposit. It sounded as if she understood the App-O-Rama, but when she talked with a viewer, she started getting the mechanics of it all wrong!

So did Suse REALLY decipher the dollars and sense of App-O-Rama, or is she just a talking head who read the script her staff created? I wonder....At any rate, lets clarify some of the errors Suze made, so that none of you make the same mistakes and can do a much more successful App-O-Rama!

Suze said that you would have to pay Cash advance charges, by taking a cash advance out from one card, then transfering the balance to another card - that is simply not correct for most 0% deals. As her own video showed, most card issuers simply allow you to deposit the 0% check right into your checking account!

Suze then said Balance Transfer fees have gone up from a max of $75 to an uncapped 3%. While some cards have increased BT fees to 3% uncapped, there are still MANY that have NO Balance Transfer Fee, and many more capped at $75.

But perhaps Suze's biggest disservice to her readers was failing to mention how App-O-Rama can help them get out of credit card debt QUICKER than any other strategy. Since you can do an App-O-Rama not just for the signup bonuses the credit card issuers offer, but to take advantage of 0% promotions, they can be used to reduce your interest payments on debt. Suze viewers often have a lot of credit card debt they are paying 15%, 20% or 30% APR, and moving that debt to 0% cards is COMMON SENSE. Suze didn't mention it at all. Shame on you, Suze.

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