Reverse mortgage industry urged to elevate standards, shift perceptions at NRMLA meeting

"This industry needs some truth and some grace for itself and for the community [of] people we're trying to impact, because there are enough issues to go around. My personal opinion [is that] the financial services community is committing financial malpractice by not incorporating housing wealth into retirement planning, he told the audience. He identified several persistent barriers that have held back the broader adoption of reverse mortgages: lack of education, uncertainty about broker-dealer policies, reputational challenges and being deemed a risky product for elderly clients."

"Ponsford also noted that many advisors still view reverse mortgages as loans of last resort and, to remedy this perception, professionals in the space need to move beyond selling products and instead approach advisors as peers focused on risk management and long-term financial outcomes. I think we have to elevate our industry to be aligned with them, he added. Ponsford said part of addressing industry perceptions involves educating both advisors and clients on the evolving role of home equity in retirement planning. While progress has been made, it's not enough."

"Central to Ponsford's address was positioning home equity access as a risk mitigation tool in retirement planning rather than a form of debt or a product for desperate situations. Retirement is a game of cash flow, he said. Most traditional ways of accessing home equity don't address the risks retirees face. Stereotyping clientele, such as assuming the product is only for financially distressed borrowers, will not help to align with firms or customers."

Home equity can serve as a significant source of retirement funding and a risk-mitigation tool, but widespread integration into planning is hampered by perception and education gaps. Advisors and institutions face uncertainty over broker-dealer policies, reputational concerns, and a tendency to view reverse mortgages as loans of last resort. Professionals need to reframe home equity access around cash-flow management and long-term risk outcomes, engage advisors as peers, and prioritize client education. Progress has occurred in advisor openness, yet adoption remains limited. Overcoming stereotypes and aligning products with fiduciary-focused advice could unlock housing wealth for millions of qualified households.

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