Halifax has withdrawn its retirement home plan which was marketed as an alternative to equity release and aimed at people over 65.
An equity-release balance increases over time while the retirement home plan stayed at the same balance, with only interest payments having to be met each month.
The maximum amount that can be raised is 75 per cent of the property’s value and the capital is repaid when the house is sold.
Halifax pulled the product from its branches some years ago but it was still available through advisers.
A spokeswoman says: “We consistently review our product propositions and criteria to make sure they remain appropriate. The retirement home plan is a niche scheme and therefore only represents a very small proportion of our business. This change ensures alignment across the group.”
Independent Equity Release Adviser Alliance spokesman and IFA Dermot Brannigan says: “It is disappointing but I am not surprised. There is still a gap in the market. There are people coming to 65 who have not got enough in investment plans or endowments but have no mortgage outstanding and can afford a monthly payment.”