Jan. 18 (Bloomberg) — Columbia Business School Professor Christopher Mayer says he's so convinced that reverse mortgages can be a cornerstone of responsible retirement planning that he's gone into the business.

The loans were criticized by regulators including the U.S. Consumer Financial Protection Bureau after they were pitched to senior citizens needing quick cash under rules that allowed borrowers to take out and quickly spend most of their equity. Now, with new limits to curb up-front spending, they can help ensure retirees won't outlive their assets, according to Mayer, who is teaching fewer classes at Columbia so he can be chief executive of a startup reverse-mortgage lender.

"It's an enormous underserved market," Mayer, 48, said of the money-making potential for the company, Longbridge Financial, in which he's also a partner. "You have $3 trillion in housing wealth among older Americans. You have large institutions exiting the market, and more and more elderly with housing debt coming out of the crisis as well as other kinds of debt."