I am in the midst of the deal from ---.The lender is charging 3.75 %on $236,000, the seller was willing to pay 2.5 points. The property would not appraise(should have) due to condition issues. I decided to cash out refinance a property to obtain the funds to close this deal.

Now, the title company states that these are two separate transactions; one cash, one w/a loan, and the cash deal will not let the contributory seller points be applied to the loan to obtain this property.

I diagree. The Texas Association of Realtors contract states: Expenses payable by Buyer are :expenses incident to any loan. The key word being "any". The any could refer to the loan required to obtain this property. The title company differs, and will not allow this transfer of funds.