All security deposits shall be held by the landlord for the tenant, who is a party to the rental agreement, in a bank, credit union, or depository institution which is insured by an agency of the federal government.

I think you are a little late to the party and dressed in a tuxedo t-shirt when it's black tie.

If the management company is properly listed as Additional Insured, the coverage will automatically be extended to both parties as needed.

For the most part I am not against your agreement, I think it's a great avenue.

It also required a second party, such as an attorney, in order to introduce anonymity since they will need to sign as the nominee trustee.

I don't know your market, so I would not be able to advise you, but just consider the sellers motives and make the terms beneficial for both parties. 

Not really a “party” town. 

The point here is - it isn't just buy some rentals and get a third party property manager, in order for you to get the direct tax benefits against your pension / W-2 income, you could readily be required to invest anywhere from 100-750 hours per year. 

They may counteroffer or request modifications to the conditions outlined.Documentation: Ensure all parties sign and agree to the terms of the offer in writing.

Here are some lists you can pull from data providers:- Absentee, Equity, Related party, Trust, Preforeclosure, Vacants, DeceasedHere are some manual lists you can pull from your county:- Tax liens, Fire houses, EvictionsI would recommend you pull some of the above lists, identify which properties are on multiple lists and start hitting those properties.