Because the buyer has poor financial discipline which is why they can't qualify through a bank.If you have good financial discipline but just have bad credit due to unfortunate events outside of your control (e.g. medical issues) then my recommendation is to work hard to recover your credit and save up the funds necessary to purchase.I'm using seller-financing right now to purchase six apartments but it's because the terms are more favorable to me and the seller, not because I can't qualify through a traditional lender.

Do you file lawsuits to recover damages, or do you just let the tenants get away with it?

That is because she has less time to recover if something goes wrong. 

Eventually it is going to bite you in the a** and it will be too late for you to recover.

What brilliant politician came up with those laws......I'm with Ned in the sense I'd love to hear more about recovering damage costs (or recovering from a tenant leaving mid-lease), for folks who don't take security deposits.Heck, I'd just like to hear how many landlords / RE investors are moving toward a "no security deposit" policy? 

Or did he lose a lot of money on a deal gone south and he's trying to recover his losses?

The insurance policy does not limit your liability, it only offers the ability for the Plaintiff to recover funds.

There's no way you can recover $3000 from tenants on disability.

One thing I would like to note: I have taken the abusers to court for non-payment of rent, and chances to recover those rents are slim to none.

It takes decades to recover and most cities never do reach their previous glory.