Praise be to Allah.
Taking out riba-based loans is emphatically prohibited, because of the stern warning that was given regarding riba, which applies equally to the one who consumes it, the one who pays it and the one who writes it down, as Muslim (1598) narrated that Jaabir said: The Messenger of Allah (blessings and peace of Allah be upon him) cursed the one who consumes riba, the one who pays it, the one who writes it down and the two who witness it, and he said: “They are all the same.”
So whoever takes out a riba-based loan, and buys a house or goods with it, may make use of it by living in the house or selling the goods and the like, but he must repent to Allah, may He be exalted.
Hence there is no blame on you for renting from her, even if she borrowed money with the aim of selling it later for profit or having an income from renting it out, and the sin of that is on her, because she is the one who dealt with riba. See also the answer to question no. 22905 .
And Allah knows best.
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