If you only negotiated a release of the lien from the second lender, in order to sell the house, and did not negotiate a release of the debt, then, yes, the lender can pursue you for the balance. Not all do. If they do pursue you, you will need to negotiate a payment of the balance. If they do not pursue you, in all likelihood, they will issue a 1099 form for the forgiveness of the debt.
This answer does not constitute legal advice and does not and is not intended to create an attorney-client relationship. The law may vary depending on the state in which you reside. It is intended only to give some direction in which to seek assistance.