Meaning that if you fund a $5K EMD and then decide not to close you lose the EMD, or you pay for an inspection up front and risk missing out on the deal while you're waiting for the report.

An idle brain/body just begins to get worse if you stop using them.

Aren't they losing money?

Hope you don't put down large earnest money deposits... these guys will make sure you lose them! 

You're going to lose your loan from what I understand.

So all of the gain and depreciation recapture are initially still tax deferred.However, like Joe said, the down side is later when sold  you lose the 1031 option. the client will pay tax on all gain and depreciation recaptured from before the 1031 also. 

This property gives me significant income, so losing it would be an extreme loss.

How can I lose???

Sometimes its better to lose less now than more in the future.

Now investors, especially the newbies, are chasing returns by going after higher risk investments - many NOT really understanding the true risks.Many more investors will be losing money and choosing to liquidate real estate - which will be buying opportunities for the better prepared investors.