Depending on your state you may need a separate bank account for your tenant's security deposit.

So, for a cash sale of $27,500 you might give an earnest money deposit of $1000 making that 5% fee $50. 

The condo will rent for $1,500/month with a $1,500 security deposit.                                                                                       

Now the terms at these auctions are usually $5,000 Deposit in Cash or Certified Funds due the day of auction; balance to 10% due within 5 business days, and Close in 30 days.

Asking a potential buyer to place an earnest deposit at risk without providing at least some insight into actual financials seems unreasonable to me.    

The seller informed us that they do not have a formal lease with the tenants or security deposits. 

As for putting 20% down vs 0-3.5%, I generally DON'T believe that putting more deposit down than needed by your Lender, just to improve cash flow, is a good idea.

I have a deposit for the model 3 as we probably going to buy 2 of those.if this roof is as advertised I will put them on everything I touch.

Were you able to get creative somehow on it, or will it just be a straight 20% down deposit and commercial loan? 

We are mainly isolating our searches to the following criteria for Holds and Flips...For Holds, we are looking to begin with a few properties that tick the following boxes:Able to purchase below market valueHave potential for Forced AppreciationAble to increase rentAble to recycle the deposit into the next purchaseCashflow positive (pre-tax)Weekly rent is approx. double the (buy price divided by 10); eg, $300/wk : $150,000 costFor Flips, we are looking for properties that will provide us with the following:Able to purchase below market valueHave potential for Forced AppreciationGrowth areas (5% or more)