I did not read the rules around security deposits. you may be allowed to use those funds and still file a small claims action for any remainder, but I can't imagine that it would be worth it if you have at least one month's rent in security deposit. 

Quote from @Gary Bonds: Any best practices when attempting to secure business funding from a bank, in the form of a loan or credit?

IN these cases they took title sub to from the sellers .. ( but in the case your describing its the same thing you have a senior note as most investors will want security) they then sold on contract to buyers with small down payments and credit challenged or income challenged and they did about 30 of these in a year or so.. worked hard at it..

He isn't rich enough to have a body guard and a security professional.

It's better to pay more, knowing you have something secured versus cheaping out and not even closing. 

With your strong credit score, high income, and solid investment portfolio, you are in a great position to secure financing for an investment property in the U.S., and as they've mentioned above DSCR is something you might want to look at.

All mortgages contain a “due on sale clause” which states that the lender may, at its option accelerate (call note due) if a transfer of the property securing the note takes place.  

No, it was secured but apparently he used the same collateral for every loan he took out. 

Now I not saying to not take the deal... just go in with eyes wide open. 

I cancelled their contract and when I asked them the security deposit be mailed to me in NJ, they sent the security cheque to some address in Philly.