I manage my properties in Oklahoma, and our Landlord Tenant act specifies that you security deposits can be used upon termination of the tenancy to correct any damages, but my understanding is that you are not able to utilize them for any reason until that point.

I also don't care to troubleshoot other newer problems she has chosen to air now because I want her out of my house after how she spoke to me this morning.  

See lines 268-276 on page 7 of the state contract:"DEFAULT OF AGREEMENT BY BUYER: In the event of any default of this Agreement by the BUYER, the SELLER shall have at the SELLER’S option the right to declare this Agreement null and void with no further demand, or to demand and sue for any of the following: 1) Termination of this Agreement; 2) Specific performance; 3) Termination of this Agreement and an amount equal to 10% of the Sale Price as stipulated damages.

RISK OF LOSS:If subject property is damaged prior to transfer of title (any, Buyer has the option of accepting any insurance proceeds with title to the property in “as is” condition, or of canceling this contract and accepting the return of the deposit.

Since the damage is done if she is paying well and on time  you really are better to keep her.

The house could have fire damage and is completely gutted, or it just needs some paint (the extremes). 

Also have issue where theres some damage to outside...screens torn out, cut a hole in garage to put a wood burning stove(also against lease) SO last week I sent them a notice via usps(not certified, priority with tracking) scheduling inpsection today at 10am(plenty of notice) also sent copy via email yesterday and text yesterday all before 24 hours.

I am redoing by basement bathroom that was water damaged.

@Kevin Zolea rental garages can be a good value add, I've had clients rent out garages with success just make sure that the structure is sound and that you can prevent their property from being damaged by rain, rodents etc.

There are many carriers that are taking on massive losses due to water damage claims (old cast iron pipes beyond life expectancy).