Scottish Widows is moving out of the purchase and remortgage market in order to focus on lifetime mortgages.
From November 17, the company will not accept purchase or remortgage applications from new customers.
In a note to brokers, the firm said the move would ‘simplify mortgage proposition’ across the Lloyds Banking Group which it is part of.
Martin Stewart from mortgage advice firm London Money said Scottish Widows was a ‘market leader’ in the field.
He added: “It is a shame to see Scottish Widows close to new business. It may be the first signal in the latest evolution of the mortgage market, particularly where you have large multi-brand businesses.
“They were, for many brokers, the market leaders for their offset products and perhaps this is an indication that we need to market what is in essence a great product in a slightly more informative manner.
"The slack will be picked up by their competitors but their loss will still be felt by many across the industry "
Scottish Widows said it would continue to provide a full range of mortgage services for existing customers.
A spokesperson for the company said: “Scottish Widows Bank’s business has naturally become more focused on lifetime mortgages, with other borrowing needs served by our other brands. This move reflects and cements that position in the market."
This week, LV announced it will launch two new equity release products in November in partnership with Scottish Widows.
tara.o'connor@ft.com
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