No Fee, Fixed Rate Personal Loan

[Dan Shelhamer]

I receive multiple of these letters in the mail every week about "Pay off credit card debt with a no-fee, fixed rate personal loan".  It always says I'm pre-approved for anywhere from $35k-$75k.
Has anyone every used these in lieu of a hard money lender or private funding? Just wondering about the pro's/con's of these. The interest rates say fixed rates as low at 5.74% (rates range from 5.74% to 28.74%) with no pre-payment penalty. Seems like it would be half the cost of using a hard money lender to do either Fix & Flips or BRRRR's if you get a rate around 6%.

[Andrew Postell]

@Dan Shelhamer I can't speak for ALL of the lenders out there but most of these offers will approve you by reducing your overall debt payments.  They check to see if you make your payments currently.....then if they can reduce that payment they approve you since it's logical to assume that if you make payment X then you would make a payment lower than X.  Again, in general, those offers will not be applicable to purchasing real estate.  There are other loan types out that can be used for that but a "debt consolidation" loan is underwritten in a different manner.  I hope that helps in some way.