Hi Nick, as mentioned before if you put a greater deposit down, you could get a better rate as a result. 

Don't be surprised if the insurance company has the family provide the security deposit.

we would have paid the 10% deposit and have had zero legal recourse to get the money back.

Not sure the extent but f the damage yet but the few things she told me about will go beyond the security deposit.  

I'm absolutely not interested in leasing fast at all and I'm extremely picky about tenants and I do things like require a large security deposit (even for section 8 renters, I have three of them and love them), don't supply appliances, take my time doing background checks and arranging multiple calls/meetings with potential tenants. 

Their most common threat is a security deposit dispute.

Needless to say the 95 page home inspection revealed that the property is in less than move-in-ready conditioned.We cancelled Escrow and requested our deposit back.

You need lease and deposit check at closing so the property has to be move in ready not a rehab.

Best practices for security deposit deductions (damages)?

Tell them to get out in seven days, use the deposit for unpaid rent, cleaning, and repairs.