foreclosed house in Clay County was purchased for $362,000, then was sold in a short sale for $110 thousand.
The $250,000 difference in price is called a deficiency.
Banks are now aggressively pursuing deficiency judgments to get foreclosed homeowners to repay the difference, and it can happen, one, two, or five years after losing your home to a foreclosure lawsuit.
Banks legally can file action to make a homeowner pay the difference in the mortgage amount and the selling price of the foreclosed property.
"We're hearing stories of people that felt the process was good and done. Sometimes it is a couple of months; sometimes it is a year after they're closed. There are stories of deficiency judgments coming down," said Charles Boyett, a real estate consultant with Watson Realty.
It happens both during short sales and after property is sold at a foreclosure auction.
The difference between the two is the homeowner knows the deficient amount during a short sale, but in a foreclosure sale, the homeowner has to wait until after the sale to find out.
"There have been some deficiency judgments in the amount of six figures - over $100,000. It all depends on the amount of loss," said Boyett.
Preston Oughton, a real estate attorney, said legally lenders can still collect after the property has been sold.
"It is after the foreclosure sale. It is the lender's election to either seek a deficiency judgment, which is a separate hearing after the foreclosure lawsuit, or to write off the debt," said Oughton.
Oughton, who handles 100 foreclosure lawsuits a year, said if the lender elects to write off the deficiency, it is reported to the IRS as income to the homeowner.
He said under federal law the homeowner can get forgiveness of the taxes on that amount by filing a form 1099-c. The deadline for the program is Dec. 31, 2012.
Oughton said it appears that many lenders are going for the money instead. "If they secure a deficiency judgment they can garnish or levy," he said.
Garnish as in wages and levy personal property. Is there anything you can do?
Both real estate experts said if you are served with a deficiency judgment, get legal help and negotiate.
"They're no longer interested in being the only one taking the loss," said Charles Boyett.
The National Consumer Law Center, a Boston nonprofit group, confirms deficiency judgments are going up across the country.
Lynn Drysdale with the Jacksonville Area Legal Aid said there has been an increase in filings in south and central florida.
Drysdale said part of the problem for consumer is investors are now buying the loan packages from the banks and they are trying to collect on that debt.
More mortgage help information:
Starting today, 14 of the country's largest mortgage servicers are contacting millions of customers who are in danger of losing their home to foreclosure. Lenders will give customers the chance to have their cases reviewed. The 14 companies will send out 4.5 million offers.
For more information, call 888-952-9105.