You have security deposit and it's something you can now incorporate into new leases.

Banks requires (2) months copies of your checking or account for the down payment.If you get the cash into the account 3 months prior it will "not" show as a large deposit that you have to source and show it came from a personal loan which then causes no issues in underwriting.

What is also very common is to charge a more aggressive security deposit or do a regular security deposit plus a monthly Security deposit alternative on top of rent to ensure you are properly Collateralized.

6) MoveIn and MoveOut inspections to document condition for security deposit reconciliation?

Photos and anything else that would help me win the case.I would recommend you do the same and I told the tenant if they do not cause damage to the property or appeal once I won then they could get the full security deposit back.Hope it goes well!

Also we are thinking about implementing a security deposit, does anybody do this. 

The typical wholesaler is cash/hard money only, non refundable deposit, no inspection period and you pay both sides closing costs.

Then how do you know if he has the money to pay the deposit and rent if you don't look at the bank accounts?

Title issues, seller issues, non-refundable deposits, no inspection period, lending issues, appraisal issues, liens, IRS liens, city liens, no wills, unpaid back taxes, solar liens, and all kinds of other crazy stuff.   

If you have a low credit score (or in this case no credit score) there are fees or an increase in the security deposit.