Nomad also held the renter's deposit hostage even after I cleared the transfer with no damages to be charged.I had to remind Nomad there is a difference between “can” and should” , while you “can” hold a deposit longer it “should” only be done when there is a question about damages.My bank liked the guarantee, the disorganization inside Nomad and the horrible vendor management would cause me not to use them again.

If you give contractors a prize for finishing early on time, they will finish then to get the prize, but there is plenty that can be left undone without you knowing that will harm you later.

However, cats can cause far more damage than dogs.

But because you rent by the room and YOU SELECTED the roommates (for which the other roommates had no control over), that makes you directly responsible to the other tenants should any harm or damage come to them.  

And that something caused your intent to change. 

Do you think this issue is specific to banking services or what do you think is the root cause?

Fortunately, we have not had any issues on the property that were caused by any pet. 

With  one property, a hotel that doubled as a homeless shelter one neighborhood over shut down and has caused problems for the surrounding areas.

Now most of the time we don't see househackers/investors use in-house or portfolio loans from banks because sometimes they have more restrictive guidelines and higher fees for holding it which might cause the numbers not to work or for the deal not to go through entirely. 

Most likely the state where the property is located is where lawsuits would be brought if they are something for personal injury like a trip and fall or something of that nature because the “cause of action” arose in that state.