A lien is a legal claim that can affect a property or the money due at closing. A payoff is the current amount and instructions from the creditor or tax office to satisfy an obligation. An older bill or notice may not show today's figure, so ask the office or creditor for the current amount and release instructions.
The title company checks ownership and recorded claims for the transaction and works with the creditor or tax office on payoff information. Your written sale terms and closing figures show how agreed payoffs and other charges are treated. If the amounts due are more than the available sale proceeds, the creditor's terms and any required approval have to be addressed before closing.
You don't need to pay off your back taxes before we settle. We buy houses with back taxes and liens — payoffs get handled through the closing, not by you upfront.