@Kate KoellerWell they could just leave and all you have are their prepaids.... so there’s that.

The recommendation to keep pre paids and and deposits off the settlement statement is good.  

acquisition fee (usually 5% if you're buying with partners or investors) Credits at closing ... repair allowance (maximum of 5% at most banks) prepaid rents (if closing on the 6th of month then 25/30 of rents go to you) first & last months rents (if charged to tenants; less whatever was used from 1st Months)Security deposits (go to you at closing) Pet deposits (go to you at closing) Income ... 

The buys don't actually get phycial cash back, they get those funds applied towards an invoice or other closing costs and prepaid items (insurance, taxes, etc.).

That basically says what deposits, prepaids  and rent rate ect. 

Regarding your “closing costs, prepaid, and escrows” those are also generally out of pocket but you can have your seller pay a few thousand dollars usually towards those costs to offset your cash out of pocket.

Delayed financing exception means he can cash-out sooner, but still limited to 75% LTV, based on "no more than the actual documented amount of the borrower's initial investment in purchasing the property plus the financing of closing costs, prepaid fees, and points on the new mortgage loan" (from Fannie)--which, in this case, would be 75% of what he bought it for, not including rehab costs.Either way, definitely check with a lender for your options and restrictions. 

They were using incorrect millage rates and trying to make my prepaid taxes way higher than they were supposed to be.

(e.g. request extra to be put into prepaids/escrow ultimately becoming some sort of "refund" when the escrow is balanced.)Thanks

Get a couple of card open, prepaid is fine like you said above, and use them and pay them off every single month.