It’s very unlikely to have been related to the home’s systems, since it’s a brand-new house.I believe I have a handle on how to proceed, but I’d appreciate any advice on how to handle security deposits with regard to cause, and tips on dealing with insurance.  

Yes, this is true, a requirement from FHA which insured the loan, quite common.

And as your "insurance" file for eviction anyway so that when/if they don't move out on the agreed upon date, you at least have started the process instead of wasting a week or however long you gave them on the cash for keys deal.

The LTV requirement was met and the PMI has been removed from the payments which currently come in just shy of $1,000 a month for P&I, Insurance, and Taxes. 

Currently living at home to save money while paying for student loans, car note, car insurance and other bills.

Rather you just pay the taxes and insurance as those bills come in.The loan from the seller to you is an asset in the seller-now-lender's investment portfolio. 

It had issues, but they were things I understood (health department and septic) from prior property management. 

Rent is in section 8 housing and rent comes in on the 1st every month  Rent: 700$House has passed all government paperwork to be section 8 compliant. yearly insurance is 345$would need to use property management company to manage the property. utilities are paid for by the tenant.Does this add up? 

The property consists of 4 structures - 2 duplexes, an SFR and 2 car garage, and has 3/4 of acre.Here is the link to my analysis using the BP calc assuming a $455,000 purchase price and below is quick summary.https://www.biggerpockets.com/calculators/shared/260799/874435c9-b77f-4f96-a3de-90be11c4cbbaThe asking price is $475,000, Assumed purchase $455,000.I've assumed $30,000 in repairs as a place holder (TBD)Current Rents total - $4,700 + an additional $75 in income from laundry machines _ According to listing broker.Taxes are $5,868 (verified)Insurance $4,500When factoring in other expenses - landscape maintenance, water, elec, vacancy, repairs, cap ex and PM I end up with $610 in cash flow.

Hey All, I've recently bought a property in Houston and had to file an insurance claim on it 2 week after I purchase the property.