Yeah the honest answer is , "don't do it" I have made that mistake with a well publicised US school on this site.
At that price it seems likely that it is only one of two school, firstly i can imagine the deposit being for the manuals? possibly! but if not seems a little high.
If it is the school i am thinking of I did my groundschool there too, see if you can negotiate the payment structure with them, they did with me. Or alternatively if they cannot do that, take your business elsewhere , there are other very reputable schools about, now that everyone is into the JAA syllabus that have got most the general answers and requirements down to a tee.
There are plenty of schools that will do pay as you go now as well when you come to do the flying training.
