Ultimately, it’s about what aligns with your budget, risk tolerance, and long-term plans.

Also, the idea separating them is so you don't accidentally spend them and then no way to pay it back when the time comes.Some states if you don't refund the security deposit within X amount of days, the penality is that you will have to pay back the security deposit x2. 

With less experienced or just poor planning operators, it isn't uncommon that they spend years distributing all the cash out to the owners, and then the time comes for a multi million dollar refresh to maintain the hotel brand, and no one wants to cough up the money back into the entity.

The biggest challenge was addressing unforeseen structural issues, which ate into the budget.

My markup is always lower than the original lender's because I don't spend money advertising during the Super Bowl, my president doesn't have a corporate jet, and we don't have layers of management we need to pay.

If it wasn't housing, food, or transportation, I didn't spend money on it. 

You’ll spend more time learning how to manage than you will actually managing something.

Additionally, have a clear budget, factoring in potential repair costs, and ensure you understand the rules about earnest money deposits and closing deadlines.LLC for Real Estate Investing: Forming an LLC for rental properties can offer liability protection and may provide tax advantages, though the tax benefits are non-existence for rentals.

That's understood.Page 19, Two faces of Debt: Federal Reserve Bank of Chicago - "banks exchange a borrower's "promissory note" or "security" for a check that other banks can deposit" (so the note is funding a check) same page states, "...the borrower can spend the deposit acquired by borrowing"... 

But they'd rather spend their time finding more syndications then worry about current investors.