If you would really want this exemption to hold up if questioned your tenant would either have to be on the deed or have equitable interest in the property such as being a beneficiary of the property through a trust or something similar.

@Sam MathewWhy not have a living trust where the trust owns the property and she can live in it and be the beneficiary so then it will automatically transfer to her?

@Tony MarcelleUpon the 401k participant's death, the funds will flow to the named beneficiary.

Short answer: If you're losing sleep because you don't have asset protection get a umbrella policy or a trust for your beneficiaries. 

WE have one foreclosure going as a beneficiary its set to go mid June.

A better strategy is to buy it personally, then transfer title to a land trust with an LLC as the beneficiary.

Owners have been direct beneficiaries of historically low rates for years, and it looks like it will continue.

Maybe an irrevocable trust with you as the beneficiary?

But since the fed give these to bank too and the bank can lend to anyone, the biggest beneficiary of Fed action is the wall street/financial sector and tech sectors.

A Beneficiary Of some kind to the estate?