The problem is that the bank has never done any deals like this and wants a 5,000$ deposit in order to get it under contract.

She signs a two-year lease for $1400 a month and a $1400 security deposit.

@Andrea Tapp  I understand your question and its straight out of wholesaling 101 and your answers are from other wholesalers who come straight out of wholesaling 101.And that is the long escrow periods.. miniscule EM deposits , long due diligence.

I think LA realizes this is so much tax revenue they want it all deposited in auditable accounts just like all the other businesses they tax. 

They make a really low deposit, and put all kinds of escape clauses in the contract, then they market the property for sale (which is borderline illegal in most states without a license). 

Do you required a non-refundable EM deposit even though that is not standard in the RE industry?

IE hey your not a landlord we are Renting to own so we do no maintenance etc etc.. well thats a pipe dream these are still renters at heart.. so very few ever get to the point they can buy.. the failure rate of these contracts is far better than 50% and the folks who lose usually have paid higher rent higher deposit and had to ( if they were following the contract pay for on going maintenance ).. they would be far better off being renters and saving money and buying a house..  

Some people do well with second chances.Here is an excerpt from our screening criteria, which is more flexible than some....LEGAL/CRIMINAL HISTORY1.Criminal offenses (misdemeanor or felony) of a violent nature against either person or property will result in denial.2.Applicants with a non-violent criminal misdemeanor that occurred more than two years ago or a non-violent criminal felony that occurred more than five years ago may be considered if restitution for their crime was made in full and all time was served.Also, we may require an additional security deposit and demonstration of good employment history, credit history, and rental history since the time of the crime.Multiple offenses may result in denial regardless of what the employment, credit and rental history shows.

I've looked through many of the assignment contracts listed in the forms area, all of them that I found state something about a deposit and the balance paid at closing.

Include a $5,000 non refundable deposit with your offer subject to your financing2.