When done improperly, as so many people do, an LLC is just a "security blanket"; it gives you the illusion of safety and little else.

Our typical strategy is to purchase and renovate a property with cash (or Lines of Credit), stabilize it with good renters, then eventually refinance on a 30 year conventional for a more secure, long term investment hold.

We're not sure how to handle the security deposit.

In other words, secure funding privately or secure funding commercially? 

TR-31 (new mandatory security) requires substantial cap ex to meet regulatory requirements. 

Security deposit amountYou can find plenty of examples by searching for "tenant estoppel certificate doc" or exchanging "doc" with "pdf" for more options.Here is an example and explanation: Sample EstoppelSome have a lot of legal jargon but this document does not need to be so detailed.

I also found out on the day we closed the loan that they have no security deposit either.

You may be able to get away with 10% down if you have multiple fix and flips/holds completed in the last 36 months and the LTARV allows for it. what if im able to fund 100 percent of rehab myself, would i be able to secure 100 percent of loan for purchase? 

btw, are you the same Jay Hinrichs of "TRUE "WHOLESALE HOUSES" that was sued by the STATE OF OREGON-DEPARTMENT OF CONSUMER AND BUSINESS SERVICES DIVISION OF FINANCE AND CORPORATE SECURITIES? 

If you are the highest bidder, you usually have to come up with a payment to secure the right to purchase the property.