First of all thanks a lot for your inputs.
From your responses it appears to me that the clause regarding the deficiency judgement is not a generic one. So is the amount that the seller has to contribute clearly indicated on these demand letters?
I am yet to sign my agreement to their demand letter. In the same letter they state that they could require a promisory note from me but also confirm that this will be of zero value. Its pretty confusing esp to someone like me.
I guess an attorney is my best recourse but before I started talking to attorneys, I wished to check with other sellers who might have experienced a similar situation. So I can convince myself that the dollars paid to the attorney is worth the money