For more than 20 years, reverse mortgages have been seen as a financial lifeline of last resort for seniors who are house-rich but cash-poor.

Now, bolstered by the research of some leading financial advisers and new rules from the Department of Housing and Urban Development, reverse-mortgage lenders hope to recast the product’s role.

Used properly, a reverse mortgage can also serve as a standby line of credit that can shield investment portfolios in down markets  and improve chances that clients won’t outlive their money.

Reverse mortgages allow homeowners 62 and older with substantial home equity to tap that equity as a tax-free source of funds to pay bills or health care expenses, or to provide additional retirement income. The loan amount available to homeowners depends on three factors: home value — up to the current cap of $625,500 — interest rate and age of the borrower. The higher the home value and the older the homeowner, the bigger the potential loan amount. Low interest rates also boost the amount available to borrow.

Nearly all reverse mortgages are government insured  home equity conversion mortgages. In response to problems that arose during the financial crisis, HUD issued new guidelines to the HECM  program in October that limit homeowners from borrowing more than 60% of the maximum reverse-mortgage loan amount at closing or in the first year after closing.

A significant study considers using a HECM reverse mortgage as a risk management tool in conjunction with a two-bucket investment strategy, coined the standby reverse-mortgage strategy, in order to increase the probability a client will be able to meet predetermined retirement goals. John Salter, a tax attorney specializing in pension matters, in conjunction with Harold Evensky, president of Evensky & Katz Wealth Management, and Shaun Pfeiffer, a professor of personal finance at Edinboro University wrote the article published in the Journal of Financial Planning in 2012

A HECM is just another way to help older adults address their retirement income needs.

A reverse mortgage also can be used as an income bridge to defer claiming Social Security benefits until an older age when they will be worth more.