> Why transfer a principal part as a loan? I suppose it doubles as a security deposit in case the tenant mistreats the property. I've known several people who

> Why transfer a principal part as a loan? I suppose it doubles as a security deposit in case the tenant mistreats the property. I've known several people who acted as landlords- one rented out an apartment above their storefront, two others rented out their homes when they had to move for work but couldn't find a buyer (this was around the 2008 crash). All three cases ended with the tenants doing significant damage to the property that wasn't covered by the standard security deposit. I think one case was a secret junkie who went off the deep end, the others were college kids iirc. I don't think I'd want to be a renter without my key money held in escrow or at the very least a lean held against the property, but that does break the system a bit.