J.C.
My daughter would not be allowed to go over to their house. I would also frequently invite the other little girl to my home. Sounds like she has a tough life and could benefit greatly by being in a loving home. At age 7 girls are completely independent.
FYI... I had a friend like this too. She was always over. In the summer my parents even got her a pool membership and eventually placed another bed in my room for sleepovers. She lived with us the whole summer she was 13. Her parents didn't even call on her 13 birthday so my dad ran out and bought a cake. When I was in college she got kicked out of her house and lived with my parents even though I was at school. How great are my parents?😊