He is requesting to hold all security deposits which I am adamantly against both in liability and just overall pain in the rear.

Even Especially if you are borrowing from friends and family, you should use formal lending agreements and register the lien against the property (mortgage) to provide security to your lenders.

I've read Rich Dad Poor Dad and I know that a lot of the reason people is for job security.

Our rental agreement must state what type of alarm it is... hard wired or battery operated and how many are installed.

I doubt you would need in central Jersey what we did which was well/septic,  maybe fire alarm? 

I can't tell you how many people ask me to diagnose them on the spot in the grocery store (if they haven't already diagnosed themselves via webMD lol).I'm sure everyone has heard the saying "Better to be thought an idiot then to open one's mouth and remove all doubt", well, when you make statements like you have in this post regarding 99.9% of Realtors being unethical you have removed all doubt.I don't take offense to you insulting a Realtor specifically, I'm annoyed by the ignorance it takes to make a blanket statement as you have done, it sets off alarm bells in my logical mind.Haven't you heard that 100% of all real estate investors are Scum Bags?  

In my day job, I am a corporate and securities lawyer and I frequently help real estate developers structure the legal entities they utilize for the investments and also comply with federal and state securities laws in connection with bringing on investors.  

Secure lines of credit, pay off consumer credit cards, and save cash. 

New to BiggerPockets forum posting (but not the blog which I love)...long story short..we have 4-flat in Chicago that we inherited and are under contract, but not clear if the buyer can secure the necessary financing and the deal may fall through so we looking at our options in case this happens.  

What about security deposit?