The idea of insurance is to protect you from a catastrophic financial event - one that could push you into bankruptcy.  

It's "put your money where your mouth is or where your offer is" showing good faith.In my layperson experience, I've seen on several occasions where 1. a contract was kicked out because it lacked a reasonable good faith deposit or EM was not given; 2. additional EM was required for the court to allow the contract to go forward, this was in Bankruptcy Court as well.Let's not forget, for these issues to arise, generally, the contract is being contested, there is some question as to validity, there are many factors that considered in concert when there is a breach of contract, in my layperson opinion, we need to consider the size and scope of the transaction, the circumstances, intent, are the parties dealing in their best interest and on a somewhat level playing field?

My concern is that because the wife is listed as a debtor in the husband's bankruptcy, she may either (i) have a claim against the property or (ii) file for bankruptcy once we get back into state court for the foreclosure hearing which would set us back an additional 3-4 months. 

Bethlehem Steel filed for bankruptcy in 2001, then it was sold in a series of transactions to an Indian company, which sold it to a Russian company, which then sold it to another company in 2012.

This allows a better paper trail and some segregation from the actions of other investors but does nothing to protect you from a QI - honest and sloppy or dishonest and larcenous.A segregated account protects you from another clients divorce, bankruptcy or EPA superfund claim. 

No point at all in investing if you do not have positive cash flow.Best options are to invest outside of Toronto and concentrate on multi units where a single vacancy will not force you into bankruptcy and you actually make money.If you are going to invest at a distance get your money out of Ontario.

I lost my first 3 in bankruptcy.

I realize Kiyosaki is a Branding Master, but he strikes me as someone who's incompetent with his own money (his bankruptcy).

Bottom line, 401K doesn't always make sense for everyone, but it offers a safety net for when you fail at RE and have to file for bankruptcy like half of the REIs did during 2009. 

If we start having major layoffs and bankruptcies that could spread to pension, insurance funds, banks etc.