Just recently had a couple of individuals who've been following us on
YouTube and Facebook for a while reach out to me with a video on YouTube
by a lady named Suzy Orman and I haven't seen the video yet I've skimmed through
it maybe a couple seconds and the title of this video is called using HELOC as
balance transfer for your credit card is a very dangerous thing to do now I don't
know if that's taking a stab at our HELOC strategy our debt acceleration
strategy again I haven't seen the full video yet I've skimmed through a couple
seconds just to see what it's about ultimately we actually ended up having
to download the video from YouTube because it was buffering really really
bad so I'm gonna go and give you my perspective I'm gonna give you my
response and my reaction and again this is not a I'm not taking a stab at Suzy I
believe she's a wonderful lady she's got good intentions and I don't think she
has a malicious intent to hurt you guys or I don't even know she knows our
strategy to begin with so let's go ahead and watch this video and give me my
perspective I'll give me my commentary and feel free to share your commentary
as well down below and before we get to the part I do want to remind you guys to
subscribe to our YouTube channel hit the bell icon for notification for future
videos about real estate investing entrepreneurship and personal finance so
let's go and kick it off I'm going to share this video with you guys and right
here in the corner so you'll see my reaction so let's go ahead and get the
show rolling right here I just wanna make sure that sound is working too okay
here we go
i'm susie orman and you are watching the Suze Orman show tonight I want to talk
to you about dangerous advice aha you heard me correctly advice that you hear
on television about what to do with your money and in my opinion sometimes it is
so dangerous I can't even stand it now I've talked to you about this before but
I'm going to say it again recently I was watching a television show and there
were two so-called financial pundits on this show and the question was I have
credit card debt I have a home equity line of credit should I take the debt
that's on my credit cards and I put it on my home equity line of credit and the
answer the answer to that question which was so dangerous was yes you should now
there were cautions about it the only caution was if you do that just
simply cut up your credit cards so you don't charge on them again okay so first
of all I would love I would love to see seen the reference that she was making
that television show she watched so that we could all figure out what they were
actually saying she could have easily filter dish could have easily picked and
chew you know chosen which parts highlight it
would have been nice to see that specific scene of course I'm guessing
she didn't want to buy any copyright issues or she didn't want to necessarily
take a stab at anyone but it would be nice to make our own judgment call as
far as what they were talking about were they talking about our strategy of debt
acceleration strategy I don't know maybe you know this was some of that maybe
it's just say hey go ahead and refinance everything you got into a home equity
line of credit and if it's if they left it at that as an end of story then yes I
would agree with Susie saying that is an absolutely dangerous thing to do however
that's only 50% of the story the other 50% 50% of the story is this our
strategy involves and taking allgor income paid on their home equity line of
credit as much as you can to lower the average daily balance to kill the
principal balance so that the interest also comes down as well now I don't know
if she quite picked on that yet so let's go ahead and continue that was their
brilliant protective advice if I could have thrown a rock through my
television I'm here to tell you I would have done so because again that was
dangerous advice so let's talk and get this straight in regards to this one
question credit card debt everybody credit card debt is unsecured debt what
does that mean that means all that security was a signature when you sign
for that credit card it is not secured by a car it is not secured by your home
it is not secured by anything if you cannot pay credit card debt
what can the credit card company do to you oh they could sue you if they wanted
to and if they won that suit so maybe they could put a lien on your home if
you had a home could they force you to leave that home no but once you sold
that home you would have to pay them well get it clue everybody most of you
don't have any equity in your home anymore so if you even sell that home
there's no money for them to get so who cares about that
can they garnish your wages can they do those things not unless they win this
suit and that's what the judge says but chances are they aren't going to sue you
there is nothing that they can literally take away from you if you claim to
bankruptcy that debt would go away that's credit card debt so one thing
that I see that I and I agree that when you transfer an unsecured debt over to a
secured debt there is a degree of risk risk there is risk and pretty much
anything it sounds like she's Fanning a lot of fear and she's downplaying the
she's definitely downplaying the the significant consequence as far as not
paying a credit card there is more than there's more again she's pointing again
she's pulling out the facts and she's doing great of that but she's
downplaying it for the for the sake of comparing it to a home equity line of
credit which is a which is a very sales salesy of her it's one of the things
it's called framing and and she's basically when comparing when comparing
a home equity line of credit to a credit card
she's trying to make the credit card sound good right and she trying to make
the whole mathematical edit look bad or sound bad again I don't think she's
quite I don't think she is quote necessary
taking a stab at the dead acceleration strategy I think I agree with her most
of the part because I think if I understand the context and again I wish
I'd seen this television show if I understand her so far and we're about
more than halfway through if you take your unsecured credit card and throw in
your home Atlantic credit and pay off your home equity line of credit as if
you were still paying off an amortized debt like a mortgage I would say don't
do it and you are terrible okay so when you use a whole medical event home
equity line of credit or personal line of credit or business line of credit the
way that we're showing you through the debt acceleration strategy it transcends
what she's talking about now again I don't think she's talking
about her strategy so let's continue a home equity line of credit is attached
to the equity that you have in your home if you cannot pay that mortgage that
loan they have the legal authority to take your home away from you they can do
a foreclosure have any of you heard about foreclosures lately
yeah she's deaf but she definitely definitely downplayed the the negatives
of the credit card and she's like making it a huge deal oh my gosh she owes you
oh my gosh is she run away from it oh here's it so far here's my answer I know
I know what you guys finish it and you guys can have this video so yes
information on your own guys there's a lot of things that are dangerous in the
world okay driving is dangerous right now I'm gonna danger because this light
bulb that it's right you know shining up my my face here could blow up any minute
catch fire and the whole house is gonna catch on fire I'm gonna lose this home
my wife is gonna divorce me and ultimately I'm gonna be depressed and I
tell myself okay not gonna happen but I think she's she's got a point
and I agree with her in most points but right now she's leading you guys leading
you guys to see a different perspective and she's definitely highlighting and
creating this emotion and a fear around the home equity line of credit we not
seen the millions of foreclosures that are out there why are they being
foreclosed on because these people could not pay their mortgage so are you
telling me that you want to take if you listen to these two so-called financial
pundits and take their advice you want to take unsecured debt and transfer
it to a secured debt known as a home equity line of credit are you kidding me
also all home equity lines of credit are recourse loans what does that mean
pundants if you happen to be watching me tonight you should get an education on
this because this is what you've just told people to do a recourse loan is if
you cannot pay that loan even if you walked away from the house whatever
happened they have the legal authority to come back after you they have
recourse to come after you to get that money even if you don't only so if you
laughs are not not the only ones that are recourse loans by the way and not
all he lacks a recourse Suze so we have to understand that he lost are not are
what's known as non-qm loans okay they don't follow a federal government
regulation as far as how mortgages are are operating he locks are private
banking products so depending on which things to go they have different returns
feature so yeah she's she's she's vilifying he lost as if it's like the
like it's a ticket to hell it's which is not again it's how you I can say listen
you should not be using a hammer because hammers are super dangerous they'll kill
you if you whack it too hard you're gonna hurt yourself
guess what if you know how to use a hammer you sure can do good things so
let's go ahead and continue watching this house anymore
is that what you want to do sure home equity lines of credit are
tax-deductible sure they're spread over a long period of time but home equity
lines of credit also increase in interest rates when interest rates go up
so it is possible okay so let me stop and stop you right there Suzie there are
fixed rate home equity line of credit and you can lock in race okay so do not
Suze a I I love you appreciate what you're doing but let's not make a
blanket statement on everything cool simple even though interest rates are
low right now with a home equity line of credit Oh a few years from now you could
see it at nine ten eleven percent all because why you listen
to some buddy tell you oh yeah it makes sense to transfer from an unsecured
credit card debt to secured home equity lines of credit that was the worst
advice I have ever heard in my life you should think twice about listening to
that and doing it I'm here to tell you that was dangerous advice ignore it
ignore it ignore it wow she looks very very I mean nice lady I'm sure but she
seems mad anyway so that's pretty much I mean there's I don't know if there's
more than the last three seconds yeah there really isn't much so guys I would
agree with her on certain part certain parts and I would disagree with her on
certain parts kind of half half in half out when it comes to my perspective
basically she thinks he losses of the most dangerous things and thing in the
world maybe she doesn't in other things I don't know however I will say this a
HELOC in itself is not dangerous it's how you used a home equity line of
credit that would predict whether you're gonna be a total financial crisis or not
so if you guys you and I and I don't think she she knows about her strategy
to even talk about it I don't think she have taken a stab at I think it from her
standing she doesn't know the strategy I would agree with her you should not be
taking a unsecured debt and simply whopping it into a home equity line of
credit you should not be taking a credit card and putting it into your home
equity line of credit and just letting it sit there and not doing anything with
the average daily balance which not good the the key if you guys seen our if you
guys read our books if you has seen our videos and trainings you guys know that
the average daily balance is the number one reason why we'd love to use the home
equity line of credit because you have the ability to not only take money out
but also put put the money back when you when you take all of your income and
make a deposit against your home equity line of credit that will lower your
average daily balance which also lowers the interest okay so that strategy and
and if you if you continue to use that strategy you will pay off your your debt
sooner and faster up to one third of time and one thirty interest so the
benefit of that far far far outweighs her
argument and again if I were if I I was a an average Joe that really didn't
understand how our strategy works and yes you should stay away from using all
my per line of credit but I do want to bring I want a home I want to bring this
all together in this one point the danger of a tool is in the holder the
the user of that tool okay if you're flying a jet and you don't have any
training on how to fly a jet and you should not be flying a jet okay but if
you have the training if you have classes you got supervised training
you've got hours into flying a plane and you know how to do it
then yeah you have the every right to fly plane and you should fly plane as
long as you are using your training properly but if you're not yes it can be
a very dangerous thing to do and you should not be doing it cool all right
guys overall I'd say I agree with her simply because I don't think she knows
her strategy if she knows her strategy she may agree with us I don't know I
don't know she you know if not met met her I every everyone has their own
opinion and their own perspective I'm just giving you guys my perspective in
my opinion all right guys thank you so much love you guys fishy guys don't
forget to subscribe and click like on our video and I'll see you guys in
another video take care well hello there you made it to the end of this video
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