# Payoff letter

A creditor's written figure that retires a debt on a given date.

You are buying assets free and clear, and these documents are the proof; money should not move until every seller debt has one in hand. A lien nobody retired stays attached to the equipment you now own, which makes it your problem to clear and your lender's reason to hold up funding. The figures also drive the closing statement, since the amount that retires each debt comes straight off the seller's proceeds.

In numbers: If the seller's business still owes $180,000 on an equipment loan, the closing needs that lender's payoff letter stating the exact amount good through the closing date; the [funds flow](https://searchspheresource.com/glossary/funds-flow) sends $180,000 there first, and the seller keeps what remains.

Source: https://searchspheresource.com/glossary/payoff-letter
Not dated: A definition is editorial: what a term means, why it matters, and an example. None of it reads a source that can go stale, so there is no date to take and a stamped one would be the build time wearing a costume.

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