Last Updated: Thursday, May 10, 2012, 5:04 PM EDT
Florida continues to bear the brunt of the nation's housing crisis. Across the state, nearly 200,000 homes are in foreclosure.
Many of those homes were foreclosed on due to a fraudulent practice known as "robo-signing," where banks falsify documents to speed the foreclosure process up.
The banks are already paying the state a $25-million fine, but on Thursday, the Florida Supreme Court began debating if that is punishment enough.
Robo-signing began as a quick way out of the foreclosure crisis as a way of replacing all the mortgage documents banks had lost in the rush of the housing boom and making it easier to foreclose.
At the height of the foreclosure process, many banks hired minimum-wage contractors to sign the falsified mortgage documents.
The problem is that it was illegal, and even though many banks have finally find the correct documents, homeowners have filed suit in hopes that they won't have to go to court again.
"After the plaintiff was caught red-handed with fraud, we never, never thought that the plaintiff would bring that case back again," attorney Amanda Lundergan said.
The homeowners behind the lawsuit said banks ought to have only one opportunity to foreclose on someone, and if they get it wrong, a second chance should be out of the question.
However, Chief Justice Charles Canady seems skeptical about that.
"I don't understand the harm that your client has endured, if in fact the bank has the right to foreclose," he said. "That just escapes me."
Bank executives said that if a homeowner can't pay, there has to be a consequence.
Consumer advocate Brad Ashwell disagrees. He said that victims of robo-signing shouldn't have to go to court.
"If you have an attorney, you have a chance of keeping your home, but if you don't and you aren't able to challenge this foreclosure in court, you're basically stuck - you're going to be out of your home, and it's just not right," he said.
Then again, many of those homeowners have been delinquent for months, if not years, and while the banks did commit fraud, if they can't get those homes back, they have no way of recouping their losses.
The Supreme Court will rule on the robo-signing case in the coming weeks.