Now, I'm imaging a scenario when every one of these tenants move out that I'll be paying their entire security deposit + interest even if there are damages beyond normal wear and tear. 

For last three years I had good occupancy, now seeing a slowdown - not sure if it is a market shift or just normalizing from the Pandemic.

Pay for your own painting and make them pay normal rent.

At it's basic level:Assumption: Asking the bank to turn the loan over to you and going through the normal underwriting process, credit, income, DTI ratio etc SubTo: Taking over the loan without telling the bank, no underwriting, no credit check, no income verificationBoth have risks, but it's not my intent to be detailed in this post.

We are not in a normal world.

Security Deposit: 2600Lease states no smoking/painting walls/no hanging things on wallsTenants have moved out and have left two truck loads of garbage to be removed.Damaged doorPainted walls which got on the ceiling and trim Lots of holes on the walls throughout the houseDamage from windows being left open constantly Weed was clearly smoked in the house (smell throughout the place) so we need to deep cleanWater bill wasn't paid so I had to turn back on utilityMissing keyQuoted costs:$450 junk removal (some furniture)$935 for damaged doors/windows, painting cleaning$30 for utility turn onTenants were only there for a year before moving out so a lot of this is beyond normal wear and tear. 

No worries, it's all in the normal course of REI.

I've done a few deals where the bank offered purchase + rehab funding up to 75% ARV, and then it converts automatically to a normal mortgage loan at the end of the rehab. 

Is the below fee schedule normal?

No, that does not seem normal.