Hi Jimmy
There were two main products aimed at elderly people.
One was the Bank of Ireland Life Loan, where they lent money at a fixed rate of 6%. It is like any other loan except that the interest is rolled up every year. They did not buy a share of the house, they simply lent money. The property will be sold when the parents go into a nursing home or die. The proceeds will be used to repay the loan. If, there is anything left over, the estate will get it. I think that the product was designed in such a way that if the loan exceeds the proceeds, the shortfall is written off so the estate won't have any furthe liability.
The more popular scheme was a Home Loan Reversion Scheme where the company actually bought a share in the home e.g. 20%. When the house is sold, the company will get 20% of the proceeds. The owners or their estate get the 80%. So these companies do suffer from the decline in value of the property as they actually bought a bit of the property.
But as huskerdu says - check out the contract.
Brendan