If you don't need the monthly income, devote it to paying those loans down faster.I do also agree with others here that a fixed rate loan right now is the better option, as rates are likely to only increase after so many years of super low rates.

Many times people who overly worry about being scammed are scamster themselves. 

Was wondering if this is a scam or not.

Here are a couple recent ones:https://www.biggerpockets.com/forums/12/topics/587565-anyone-knows-james-mourine-or-mourine-jameshttps://www.biggerpockets.com/forums/49/topics/595905-lender-scam-warning-north-carolinaOn the other hand, if you do know the private lender well (friend/family member) then they're likely well-intentioned. 

They can do whatever arrangement they agree on (birddog fees, cash under the table, some weird bottle can return to Michigan for 10 cent refund scam) as long as me and my client are not involved in their dealings, it's not assignable and it's not on the HUD-1 form I don't care what they do.Good Luck, 

This particular bank has devoted several hours of their VP of Business Developments time. 

If he doesn't need the income now, I'd say go for a 15 year loan and devote all the cash flow to paying down the loans, one at a time (so minimums on loans 2-6 and everything left over from all those rent payments onto Loan 1, till 1 is paid off, then start focusing on Loan 2, etc.)

Because I am just starting out, I'm having a hard time deciphering between legitimate and "scam" companies and have already been burned once.Thoughts or insights on these companies?

It's great for beginners & those who don't have the time or want to devote the time to running a rental property portfolio.

No offense, but that is just scamming your family to take 3% of their home value from them.