I think it really comes down to what you are comfortable with but I don't think background check, credit card check, etc on top of a signed lease (and even small security deposit) is unreasonable for an MTR. 

Or should I raise the price of rent to match the current rate in Denver?

You can also use a bank statement loan or SE program to use gross deposits versus taxes that have deductions.

Happy clause.....Its obvious you are not happy with the unit.. its rented "as is"..... since you are unhappy with the unit, I will gladly let you out of your lease within 30 days, with no penalty to you and will refund your entire deposit if the unit is returned in the same condition as rented. 

Non refundable vs refundable pet deposit? 

Autocorrect can't match my lightning fast fingers.

Try biggerpockets agent match: https://www.biggerpockets.com/agent/match

Standard down payment for a new primary mortgage typically range between 3%-5%If you need the rental income from the home you are departing you typically will need a fully executed lease and proof of 1st payment and security deposit

So if you claim a purchase, and they claim a sale - did the figures match?  

My credit union account shows the following entry:: "Withdrawal RT # NOT DEFINED [TENANT'S NAME HERE] 6060, -$1950.00." indicating that the deposit of the tenant's rent check #6060 in the amount of $1950.00 was reversed, resulting in a debit to my account of that amount.