So I negotiate terms with the seller (option price, length of term, option deposit, monthly lease payment) and get an agreement signed.

Tenant put deposit and first month's rent down, which I used to cover closing costs, signed lease was used to meet bank requirements, and total out of pocket was less than $2000.

Tenant put deposit and first month's rent down, which I used to cover closing costs, signed leas How did you finance this deal?

How much of a security deposit are you allowed to collect? 

If we are in acquisition mode, we'll have a little more in case we need to make deposits to lock deals up quickly.

Based on this, if you use traditional IRA funds for an investment property deposit, the 10% early withdrawal penalty applies? 

I then spend the next days or week going to mechanics and insurance companies to determine what it will cost to fix this and that and customize this and that, and call insurance to get a quote.While I am doing all of that work above, Joe from down the street where you live stops by and says hey Andre, I'll buy your vehicle, here is a $2000 deposit and a signed contract to buy it.Should I be upset at Joe down the street?

They paid 2 months on the second month.Now I get a direct deposit on the 5th like clock work.

Which I get, that you can take cash flow and turn that into deposits for future investments.I don't quite understand buying homes using home equity loans, but it really sounds like if you owe X on your house and your house is worth Y you can borrow an amount equalled to the difference. 

(we use direct deposits into a bank account)Don't lie to the tenants.