I am a bit unsure how it works exactly? Does it eat an action or remove a swift action from you?
"Use an Immediate-Action Ability: You can use an ability that can be used as an immediate action in the default action economy, as long as any conditions to use that ability are met."
Or is it like a free action basically?
Ahh didn't notice this:
"When it's not her turn, a character can take a single reaction per round".
Right, your reaction is the actin that you can use to take immediate actions. It's also what you use to make attacks of opportunity.
It no longer uses up part of your turn.