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David Bach was on the today show this morning. He was touted as a financial expert. What?!? He is proof that financial advice on TV is a disaster waiting to happen. This guy published a book in 2006 titled “The Automatic Millionaire Homeowner.” In 2006! Anyone remember anything about 2006? It was a turning point for the housing market. He was a cheerleader – encouraging folks to purchase a home at the height of the housing bubble.

David Bach is probably the last person you should be taking advice from – unless you’re trying to sell a book.

Transunion is charging to place a credit freeze on your file. The charges to add, lift, or remove a credit freeze vary by state and can be found here. Some states even have differing charges based on your age. Here’s an idea. Make them free…But if they were free, it would hurt TransUnion’s business model.  We wouldn’t want to hurt a credit reporting agency’s business model in an effort to help consumers against fraud, would we?

Okay, so this doesn’t improve your score directly, but there are benefits. Freezing your credit report with Experian will keep your Experian score from going down due to hard inquiries when applying for credit.

So, you want to apply for some credit cards, or otherwise initiate a bunch of hard pulls on your credit report, but are worried about the consequences of hard inquiries staying on your credit report or a dip on your FICO score. You already know about bumpage, accelerated bumpage, and choppage, so you’re not too worried about your Equifax or Transunion scores being hurt. What about your Experian score? (Remember, bumpage doesn’t work with Experian.) Just freeze your credit report with Experian. The hard pull that would otherwise be on Experian will likely redirected to a different credit reporting agency (CRA) – either Transunion or Equifax. The risk being run is that the institution trying to pull the Experian report will decide not to pull from a CRA, and a denial letter will be sent. I’m not too worried about getting denied credit – if my score stays in tact. Don’t forget, if you really want to, you can “thaw” your credit report temporarily, or remove the freeze altogether.

Clark Howard has a good guide on freezing your credit report with links to the various CRA’s websites. The cost is $3-$10 per bureau to freeze, and a cost to thaw per bureau of $0-$10.

I’ve been using App-o-Ramas and Bumpage along with credit card churning and selective credit freezes to turn a profit – and I have profited significantly from these practices. There are a small group of folks who know about these tactics and use them to their advantage. These ‘credit hackers’ take on the big banks with their legalese and beat them at their own game. These ‘credit hackers’ have done a good job prying profit from the giant monster mega-banks, but thanks to a recent paper (which I refuse to link ) and a speech at the Defcon hacker conference, banks might decide now is a good time to change the rules of the game.

A (creepy looking) Harvard student fellow, Christopher Soghoian, thinks these practices should be eliminated. Why? Because they might be a tool in the hands of identity thieves and it costs the banks money. I believe he wanted to publish a paper about ‘credit hacking’ (Which isnt hacking at all. It’s using the rules of the game against those who wrote them), then earn big bucks doing consulting work.

Guess what Chris… The banks already know. They’ve known for quite some time. They’ve made a deliberate decision not to do anything about it because the costs of eliminating the loopholes are greater than the benefits. Don’t you know anything about cost/benefit analysis? Or, are you too busy printing fake boarding passes to learn anything finance related?

The good thing about the nature of the community of ‘credit hackers’  is if their current methods no longer work, they’ll find a new way to beat the system. Thats what hackers do.