You should put a tight schedule on them putting the financing commitment in place, and have a non-refundable deposit if they stretch that out too long, but you should not care what they are doing with it. 

I didn't have that clause in my lease before I read that...Your lease should convey pertinent information, like how much the rent is, when it's due, the amount of deposit.

., former employer 401k) to a solo 401k are not reported on Form 5498, but rather on Form 5500-EZ, but only if the air market value of the solo 401k exceeds $250K as of the end of the plan year (generally 12/31);When funds are rolled over or transferred from an IRA or 401k to a self-directed IRA, the amount deposited into the self-directed IRA is reported on Form 5498 by the receiving self-directed IRA custodian by May of the year following the rollover/transfer.Rollovers (provided the 60 day rollover window is satisfied) from an IRA to a Solo 401k or self-directed IRA are reported on lines 15a and 15b of Form 1040;Pre-tax IRA contributions on reported on line 32 of Form 1040;Pre-tax solo 401k contributions are reported on line 28 of Form 1040;Roth solo 401k funds are subject to RMDs;A Roth 401k may be transferred to a Roth IRA (Note that from a planning perspective, it may be advantageous to transfer Roth Solo 401k funds to a Roth IRA before turning age 70 ½ in order to escape the Roth RMD requirement applicable to Roth 401k contributions including Roth Solo 401k contributions and earnings.)

Money is direct deposited into her account actually through her company.

The main difference is that instead of flipping it for the profit you COULD make, you would be borrowing against your added equity in order to get all your deposit back - to Repeat, Repeat, Repeat... 

@Scott Ellis The simplest way to solve your issue is draw down on the LOC or Heloc either one and deposit the money into your savings account.

I've posted a few articles below which outline the new and most restrictive ("progressive") rental laws in the country, which limit the size of security deposits, non-refundable deposits, and requires giving tenants and option for a payment plan to pay move-in fees.

I did not and refunded the deposit and sold it to somebody else.The buyer got "cold feet", literally.

I'm wondering if I should establish a separate banking account in which to make deposits and let the bank draft the mortgage payment from that account. 

We will be renting a SFH to three college students beginning in May, and would  like input on how to set up the security deposits.