In California, yes a security deposit can be used to cover unpaid obligations that were the tenant’s responsibility under the lease, as long as you provide an itemized deduction within 21 days and proper documentation.Under CA Civil Code §1950.5, a landlord may deduct from the deposit for:Unpaid rentUnpaid utilities the tenant was contractually responsible forDamage or losses beyond normal wear and tearOther necessary costs incurred because the tenant failed to meet lease obligationsIn your case:1.

They purchased using a program that finances 100% of your purchase/rehab on paper, and takes a 15% deposit as cash-collateral that they hold until you refinance.• $60k purchase• $35k rehab• $95k total rehab loan payoff• 15% deposit = $14,250 "down payment"• $126k ARV (confirmed via refinance appraisal, borrower expected this to be higher)• 80% rate/term refinance ($100,800 loan) @ 6.75% [700-719 FICO]• Applied $4k of deposit to payoff for an updated payoff amount of $91k• Cover closing costs with 80% r/t refi + $2k back to borrower at closing (still considered a r/t refi if under $2k) + remaining $10,250 deposit reimbursed after payoff = $12,250 total back to borrower• $4k of his deposit + closing costs for rehab loan = his "cash" in the deal• $1,250 market rents• Total PITI = $765.62• DSCR = 1.6327 I do not see the hold costs.  

Not all debt is bad — sometimes short-term loans help reposition a property for stronger cash flow.Examples include:• Using bridge loans to renovate before refinancing• Stabilizing rents before transitioning to long-term loans• Leveraging interest-only periodsHow have you used short-term financing to strengthen long-term ROI?

When it comes to cash flow on multi-family properties like duplexes, triplexes, or fourplexes, a common rule of thumb is to aim for at least 1% of the property’s purchase price in monthly cash flow after all expenses.

If you already own the lot and have a great deal of equity in the property, you might be able to pull some cash out.

If I could refi at a little over 3% at 30 years, both these would likely cash flow.Here is your options: 1) buy the cash flow with a lower LTV.  

The Conti and Finkel's  “Big Money Cash Close,” but at its core it’s really just a seller carryback combined with a new first mortgage.

For our tenants that still want to pay by check or cash, which is not many these days, we have a business bank account that they can make the deposit directly into - all they need are the last 4 of the account number and the account name.

Anyone going to craigslist must be a little desperate and so that is an awesome resource for cash buyersGet a pro membership here on Biggerpockets and you can start posting deals on market place.Get BOTH a motivated seller website AND a cash buyers website going, rank it #1 and cash buyers are constantly messaging you if you have a deal available.

Anyone here recently refinanced an underperforming rental and saw cash flow jump?