As far as I know (I could be wrong), Selina lives with Irene by permission of her mother, therefore Irene doesn't need to pass any official fostering criteria. She's not an official foster mother it's more of an agreement between Irene, Selina's mother, and Selina. Chloe is a boarder and Irene has no legal parental rights - I have vague memories of a scene where Chloe tells Irene she is only a boarder not a foster daughter and Irene therefore has no right to tell her what to do.
The difference between this and official foster parents (like Pippa) is that legal guardianship of the children is removed from the real parents by the state and granted (temporarily) to foster parents, which means Pippa has the legal right to make decisions for the children in her care.
That's how I see it but I'm sure someone else could explain better.