What should I do? Please help!!!

Long story short. A lady (T) wanted to rent my house at the beginning of this month. She is in Section 8 program so she can not pay me rent until her current lease ends this month. So she asked me to hold the house for her so that we can start the process with section 8 office. And She proposed that she will pay money to compensate my loss rent for this month. My monthly rent for this house is $1395, I discounted to $930 for her. Now that the paperwork wasn't approved by the housing office, she wants her money back or signs the lease with this amount of money deducted. Isn't it right. Please read below for the agreement we signed. I know I screwed up a little bit with this agreement but I want to know what I can do according to this agreement.
Please help! This is my first time to rent our house out.

Receipt and holding deposit agreement

This will acknowledge receipt of the sum of $930.00 by Nikwasi ("Landlord") from T ("Applicant") as a non-refundable holding deposit to hold vacant the rental property at XXXX until 8/31/2009 at 11:59 pm. The property will be rented to Applicant on a 12 months basis at a rent of $1395.00 per month, if Applicant signs Landlord's written residential lease agreement and pays Landlord the first month's rent and a $1400.00 security deposit on or before that date.

Landlord and Applicant agree that if Applicant fails to sign the resident Lease Agreement and pay the remaining rent and security deposit, Landlord may retain of this holding deposit equal to $930.00. Should the Lease Agreement be unable to be signed through no fault of Landlord or Applicant, Landlord may retain of this holding deposit equal to the prorated daily rent of $50.00 per day starting from this 3rd day of August, 2009