modding effects on 360?

sorry if i reposted. just realized i posted it in the wrong place.

so what negative effects are there that modchips have on xbox 360? do they effect performance or playability on live or aything? im new to 360 mods so im not sure.

 

lol any mod prevents xbox live...yeah sure you can use it for a few hours but you will shortly be banned...

 

can u use the chip offline, and then use real disc games for live?

 

i mean playing burnt games with an offline account and no connection to the internet.