First of all, I appreciate any advice you can give me.
I cosigned for my father in 2001 for an unsecured personal loan for $11,000. He was paying and the balance was down to $8434.00 He lost his job and was unable to pay so he filed bankruptcy in 2003. The lender tried to contact me a few times to collect, but at the time, I, too was unable to pay anything. Now, 3 years later, I was turned in to a collections agency and they are now demanding $9000 on their first letter to me. I didn't reply until
Their 2nd letter reducing the balance down to $6900. I sent them a letter today telling them to provide me proof that I owe this debt. I did this to buy some time and think things through. I cannot pay this much. Will I get sued? If so, will I also be liable to pay for court and legal costs? Help, help, help! I am downright depressed... :(

Yes, you could be sued. Generally, co-signer agreements mean the debtors (you and your father) are responsible "jointly and severally", which means they can pursue either or both of you for the money... and since he's filed bankruptcy, that leaves only you for them to pursue.

Sorry to pass along the bad news.

I suggest you continue to negotiate with them to see if they'll let you make payments on the settlement amount they're offering.

And if they do agree to payments on the lesser amount, get it in writing.

Sorry this happened. Since your father filed bankruptcy, they can not longer go after him, but since you co-signed the loan, they can go after you for the full amount due plus late fees and collection fees allowed by law and/or the contract.

They can sue you in court to get a judgement, if you indeed signed for this loan, then yes they will win. Once they have a judgement they can ask for a attachment (freeze) your bank account, and also ask for a garnishment of your paycheck ( 25 to 50 percent)

So it would be in your benefit to try and work some payment plan out with them.