Ordinarily those tenant vacated damages would be too remote, but it sounds like they were contemplated by both parties at the time of contract.Were I in this situation I would be looking to state law to determine if the EMD is truly the extent of my potential liability as a buyer. 

When the tenant moves out and the funds are distributed either to the tenant or the landlord for damages, then the subaccount for that specific tenant has a zero balance and that subaccount is closed. 

Depending on the resort the 7/9 bedroom was in, yes, it will generally perform better than a 4 bedroom in any reputable resort, including solara. 

Insurance protects your property from paying out of pocket for damage, plain and simple.

Does anyone have a template or method that they use in order to screen tenants effectively in order to reduce the risk of non payment and damage to the property? 

Also think about what can be damaged (tenants generally don't take care of the place as well as you would). 

The real estate investing industry uses "Classes" to rank property performance risk, but there's NO agreed upon industry model:(Here's what we use for our Metro Detroit market:Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

It might take a large financial institution with capital for “brainpower” and marketing, and financial and reputation strength to design as well as create a trading market for this type of security. 

We are an LLC, but I wanted to know what type of reputational hit this will be for us and if this would show on our credit in any way.

Make sure you’re working with a team that has a good reputation and understands the market.3.