@Jonathan Harms, thank you!

After that you can rent it and there is no harm.

I would say it is, at best, misleading.It might seem like a great way to learn BUT there is a likelihood that it can harm sellers. 

It is is the harm that comes from treating people badly over time.

The Asbury Park Press also tried to reach Castrovinci by phone and received the same message that his voice mailbox was not set up.The Dumonts had to cancel “numerous rental contracts,’’ for April, May and June, suffering irreparable harm to their reputation as landlords in the small, seaside town as a result of Castrovinci’s refusal to leave, the lawsuit said.

No harm in doing that.

If they are just acting as a lockbox on your first lien payments, which is what you I think you are describing, then I do not see the need for the paper shenanigans of "pretending to loan $282,000" (as you could just do a separate lockbox agreement with them) but I also see no harm in it.  

Believe me we are good people we never wish to harm anyone but on this case what should I do as a renter., we don't have renters Insurrance?

And as far as people close to me I can't say, but there's no harm in checking right?

He likes the sciences and wildlife.