I like the advice given by @Sam LLoyd and @Michael Boyer which eliminates the holding deposit completely. 

@Fred Sams get an SBA loan - uses ROBS to fund the downpayment - (Roll over business startup) - the guys from My Solo 401k here on BP helped me navigate the ROBS process. 

I think as we climb out of this recession we will see another variation of how corporations take advantage of the American people.  

@Sam Waddell

If you have grit, you can make a bold, risky move, knowing you’ll be okay regardless of the outcome.As the American entrepreneur, Robert Arnott, once said, "In investing, what is comfortable is rarely profitable."

Because of widespread racial and ethnic disparities in the U.S. criminal justice system, criminal history-based restrictions on access to housing are likely disproportionately to burden African Americans and Hispanics.

However, this was a vacant REO property and the title provided allowed me to purchase a Title insurance policy as part of the purchase transaction. ( I insist on either First American or Fidelity as the insurer as I am familiar with their policies)  I have since seen properties listed on Auction.com with quitclaim titles and other types of title that I don't recognize also many of these properties appear to be occupied and these properties I would be very careful of. 

@Sam LloydI hear what you are saying about living in the property while it is being rehabbed.  

Thanks @Fred Sams

. :)@Sam samir: Thanks for the info.