Where things got fishy is when the landlord stated that their son would be paying "1500 in rent" and if my relatives could match the amount, then they could stay.

direct deposit. 

If personal, they will take 100% of your deposits as your income.

My bank is about 1/3 mile from my house so deposit is not a problem.

We painted it to match the neutral wall color used to paint the rest of the house.

It took about a to be contacted by the Tenant's Estate Attorney about returning the Security Deposit.

I would also recommend something like Acorns which is a Round Up investment vehicle where you link your debit card to the account and every time you make a purchase like $3.49 for a coffee the round up to the nearest dollar amount, $0.51 gets deposited in an investment account.

From here, assuming you get pre approval for a new construction loan, moving into a cheap rental would be one option- I would be cautious of where if you have school age children; in some districts the mailing address must match the home address for the children to attend the same schools as now, and I doubt you would want your tenant receiving anything from the school as it pertained to your children in terms of privacy if you tired to get around this by listing current address as home and mailing address.

I am a newbie investor and I am wondering about pet fees and deposits.

What is the deposit for?