Security deposit amount and any other insite on topic?

Current lease and security deposit was requested but the seller's attorney says that it is month to month with no lease and no security deposit, they are offering an estoppel letter from the tenant.

However, I will accept high-risk tenants if they pay an increased security deposit or a risk mitigation fee (non-refundable).In my experience, people with bad credit are bad tenants.

How can I determine status of security deposit?

He was sued for negligence.I followed the case as my employees were called down for depositions.

Also can I legally require tenants to put down an additional security deposit if occupant has history of property damage or no background? 

The current landlord collected a security deposit of one months rent.

I took security deposits equivalent to one months rent. 

I look for the best applicant.Someone that has had same job for a couple years, someone with more income that can pay the rent.If I have to give a little one one of my criteria then I get a larger deposit, usually 1.5x the rent or first, last and security.Sometimes you have to keep looking to get a good applicant.I have been luck I usually get 30 people inquire and 4 or 5 apply.Section 8 can offset a low creidt score since their rent or part of it is guaranteed by the government.

Am I justified in using his security deposit to repair the damages?