The Reds are seeking competition for Jose Enrique at left-back and are known to be keen on the France international, who made 32 appearances in his debut season at the Mestalla last year.
"Liverpool have made me an offer and it is true that I have reached an agreement with them," Cissokho said on Le 10 Sport.
"It is now up to the clubs to agree terms. I expect to know more later this week. If nothing happens this week, it probably means that I will not be going to Liverpool.
"The conditions of the transfer are the problem. Liverpool prefer a loan deal with an option to buy, while Valencia want to sell straight away."
The 25-year-old only moved to Valencia in a £5m switch from Lyon last summer.