And my logic was, I have three mortgages, whip out my checkbook, and write three checks a month, and the rents greatly exceed the payments.

You may keep the security deposit if the damage exceeds the deposit or return a portion of it based on the estimated repairs You must return deposit within a reasonable amount of time This is the New York laws https://www.thebalance.com/new-york-security-depos...

I know I could make 6k + a month with 5 houses in Phoenix and keep them rented out, but the amount of work/repairs/screening involved would exceed my time.

Ill have exceeded your goal of $1200 a week in cashflow I can put in my pocket but it took 30 months instead of 6.

Regarding taking a 401k loan: You would have to confirm that your 401k plan allows for a 401k participant loan (and that you have not had an outstanding loan in the last 12 months).If yes, you can borrow up to 50% of the balance not to exceed $50,000.The repayment terms are equal monthly/quarterly payments (as you prefer) of principal and interest (e.g. prime + 1%) spread over a 5 year term (or longer if you will use the loan to purchase your primary residence).

Not only would it be costly to "contractor it out" but the time to complete the work would exceed our project schedule. 

Their combined philanthropy exceeds the Rockafellers, Carnegies, and Kennedys combined.

As more families lose their homes to foreclosures, as lending guidelines tighten, and as 6000 people per month continue to move to the valley, we will see rental demand exceeding supply and the rents in Las Vegas (which have remained fairly stable for the last several years) will increase to offset the demand.

(not to exceed quote)Since rents in the area aren't as high as I'd like, around 1,000/month, the property doesn't cashflow.

If that exceeded the security deposit, I'd go to small claims court and get a judgment, for what that's worth.