Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.
In Florida, three types of creditors can force the sale of a homestead to collect debts owed to them. These are:
Thus, your home is not exempt if you've pledged it as collateral for a small business loan. That lender can still foreclose and recover the house.
If the sale of the home does not satisfy the debt, can they come after anything else?
If there is a deficiency in the amount owed on the loan and the amount collected from the foreclosure sale, the lender can seek a deficiency judgment against you for the difference.
If a judgment is obtained, the lender can attach any property you own free and clear, sell it, and apply the money to the judgment. The lender could also garnish your wages.
If you're facing foreclosure, it may be worth requesting the lender to accept a deed in lieu of foreclosure. This avoids the foreclosure process by you just voluntarily issuing a deed to the bank. Also, if the bank will accept this deed, it cannot seek a deficiency judgment against you.
Whether or not the bank accepts the deed is totally at its discretion. It does not have to do this. However, if the bank will agree to this, you'd be much better off.