Forget the 'loan of last resort' label – reverse mortgages are becoming retirement's most misunderstood power play
Skepticism still clouds reverse mortgages, but Parker Turk (pictured) believes the tide turns not with marketing, but when trusted advisors fold it into real retirement strategy.
Even as more homeowners enter retirement with substantial equity, reverse mortgages remain underused and stigmatized. According to data from the US Department of Housing and Urban Development (HUD), only 32,991 Home Equity Conversion Mortgages (HECMs) were endorsed in fiscal year 2023 - a sharp decline from the program’s 2009 peak of 114,692 originations.
Parker Turk, president of Sun American Mortgage, has seen the full arc of the industry’s reputation. He began originating reverse mortgages in 2006 while still in college, going full time after the financial crash. What hasn’t changed is the skepticism.
“While I was going to college, I would originate reverse mortgages, but full time since 2009,” Turk said.
He was quick to confront the lingering myth that a reverse mortgage means giving up ownership of your home. “If you own a house, if you have equity in it, reverse mortgaging your home doesn't mean you’re automatically giving that up,” he said.
Turk said real change happens in person, not on billboards. “You can do all the advertising you want, but until you actually sit down with them and really educate them, that is when the lights really go on.”
Rather than push a product, Turk positions reverse mortgages as a strategic option - one that gains legitimacy when trusted professionals like estate planners and financial advisors embrace it.
Advisors as the missing link
“The more financial planners refer to [reverse mortgages], the more people will overcome the skepticism,” he said. “It's all about estate planning attorneys, financial planners, trusted advisors. Once they understand the program, they'll start to utilize the line of credit more.”
Turk often enters the picture during a critical financial pivot: downsizing. For many retirees, this is when reverse mortgages become most useful - and most surprising.
“You sell the first one, you buy the second one with the reverse mortgage. Now they get to keep more of the proceeds of that first house and still get to have no mortgage payment,” he said.
He’s seen it work across the spectrum - from multimillionaires to those living month to month. What’s changed is who’s considering the option and why.
“People look into this for so many different reasons,” Turk said. “A lot of times people are just trying to help their grandchildren or their children out.”
Economic conditions and the case for patience
But the current economic environment adds new layers of complexity. Because HECM products are tied to prevailing interest rates, those rates directly impact how much cash homeowners can access.
“When the interest rates rise on that product, the access that a homeowner has goes down,” Turk said.
Still, for borrowers who don’t need the money right away, that same interest rate environment can work in their favor. Lines of credit grow over time - and that growth is pegged to interest rates.
“If you're setting this up for the future then it'll actually still work out pretty good,” Turk said. “Because now it's just compounding and growing for you.”
Credibility, education, and clearing out the noise
To Turk, the most powerful tool isn’t a loan structure - it’s education. That’s why he leverages credentials like his CPA designation and encourages others to seek out professional standards through organizations like the National Reverse Mortgage Lenders Association (NRMLA).
“Taking the time to first educate yourself and maybe aligning yourself with people that have the industry and the borrowers’ best interest at heart – then you're going to really understand what to say and what not to say,” he said.
And while bad actors still exist in the industry, he said they tend to operate outside established frameworks. “It’s very rare that I see the bad actors in the industry belonging to [NRMLA],” Turk said. “Usually, it’s people that are more fly-by-night trying to sell seniors on taking money out and buying annuities and different things that cause issues.”
Looking ahead, he sees growth coming from proprietary products in high-value regions. But for the FHA-backed HECM loans, the hope is that the benefit amounts can come up over time with the health of the FHA insurance fund getting better by the year.
“At some point in time, I hope they’ll change the principal limits,” Turk said. “We used to give out significantly more. Now it’s swung the other way.”
Ultimately, Turk isn’t waiting for the industry to fix its image - he’s making the case one family at a time.
“I’ve done it for my grandparents. My dad potentially will get a reverse mortgage line of credit soon,” he said. “It's expensive upfront, but I’ve just seen too many benefits from having the flexibility that it offers.”
