The North Carolina-based bank is to cut 125 jobs as a result of the move.
Wachovia, one of the banks worst-hit by the ongoing global credit crisis, recently announced a second quarter trading loss of $8.9 billion.
The firm's balance sheet has been further stretched by its attempted $24 billion buyout of Golden West, a California-based mortgage lender, in 2006.
A spokesman commented: "We're not going to have any Wachovia mortgage-branded, face-to-face sales staff in those states."
It will continue to offer home loans in 18 other states, however.
Wachovia, America's fourth-biggest bank, has already announced plans to cut around 10,700 jobs from the firm and reduce overall expenses by $2 billion over the next year and a half, as it battles to restore its balance sheet.
The firm has already reduced its retail mortgage staff by 2,000 so far in 2008, with 4,400 more to be cut from the unit over the next year.