Don't be surprised if the insurance company has the family provide the security deposit.

I recommend you find a qualified intermediary who:Will not commingle your funds with other clients.Holds a Fidelity Bond with Errors and Omissions Insurance.Member of the Federation of Exchange Accommodators and Better Business Bureau.Wire Transfer Security measures to counter wire fraud.Have a great day!

Overall, it is okay, but it still requires relinking the accounts periodically, which seems more security-related than anything else.

Security deposit amountYou can find plenty of examples by searching for "tenant estoppel certificate doc" or exchanging "doc" with "pdf" for more options.Here is an example and explanation: Sample EstoppelSome have a lot of legal jargon but this document does not need to be so detailed.

For instance, one property seems to have an extra bathroom that is not listed in the county records.I plan to make some modifications, including removing a closet wall to expand a bathroom and taking out a kitchen island that contains electrical outlets and a switch.

Also the Voucher doesn't cover the security deposit which in most cases, I have to put my S8 tenants on a security deposit payment plan for those to get them qualified to move-in on my applications.

You might be able to secure a loan with 20% down in some cases.

Best practices for security deposit deductions (damages)?

Quote from @Gary Bonds: Any best practices when attempting to secure business funding from a bank, in the form of a loan or credit?

I did not read the rules around security deposits. you may be allowed to use those funds and still file a small claims action for any remainder, but I can't imagine that it would be worth it if you have at least one month's rent in security deposit.