There are many people on this forum that are heavily leveraged and some will be financially destroyed in the coming years.

Keep her deposit and let her go without further actions.Get a happier tenant who actually wants to be there.Clean up the place and charge higher rent for the next tenant.Don't buy yourself a pack of trouble.She could destroy the place while your sucking lawyers on her and could force you into courts for months while not paying a dime.

When the tenant destroys your house, the PM can say, "Well, you're the one that approved him." 

One was backing up the disposal and continuing to run the dishwasher, flooding entire kitchen and crawl space and destroying hard wood floors. 

(Seller financing,Partnerships, Syndication, Sweat Equity etc)  I'd recommend ALL of these before a 100% hard money loan that destroys you in fees and fine print..

The repairs can destroy your returns.

Poor workmanship will show up quite obviously when you go to put your home on the market and it will destroy your profit margin. 

Relationships and reputations destroyed - even inside families.No handshake deals. 

If they leak it will destroy one or two units.

I even offered to pay my tenants $100 to help with their renters insurance and not one tenant every took me up on my offer.I can see where a general contractor can legally require a sub contractor to purchase liability insurance because and damages caused by the sub contractor will pass down to the general, but if the tenants personal items are destroyed in a flood, fire, theft then that damage does not pass down to the property owner.