I am okay holding it but wanted to issue a "holding deposit" that would turn into part of security deposit at lease signing, but if for some reason they back out it could semi- recoup the cost of holding and not advertising. 

For example, you buy the place and the tenant could claim the Seller allowed them to paint the walls black or that their security deposit was twice what the Seller claimed.

Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

She has told me that she isn’t paying another months rent because I have the security deposit.

If you feel you have a case, you can take a chance and take it out of his security deposit. 

Will the tenant forfeit the security deposit? 

Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

With a majority of all things being equal, I selected our PM with weight on that termination clause.Certainly put us at ease that if, for whatever reason, either party is unhappy in the relationship, we can cancel the contract. 

I'd also require a 2 month security deposit, but that's just me.

You do have their security deposit but do not use it or tell them you will use it!