Have you considered asking them to put a lien on one home or the other so that way they get their money back when the home does sell?
I suspect that (1) yes, you owe them the money regardless of what the housing market has done and (2) they could take you to court for the amount owed and get a judgement against you. Depending on the state and their respective laws, they might be able to either garnish your wages OR put a lien on your home due to the judgement.
It sounds like they have already been generous -- by forgiving $50K of the debt. It is not their fault that the housing market tanked either. Both sides made some bad decisions, but that doesn't mean the company should have to eat the whole loss.

