Remarks on your proof:
Line 3 does not hold for negative $a_n b_n$. Work wih $\lvert a_n b_n\rvert$ rather.
Line 4 must focus on a choice for $N$.
Line 4 must require $a_n b_n > a_N b_N$ for the second inequality of line 6 to be true.
Suggested proof:
For any challenge $\epsilon>0$ we have $\sqrt{\epsilon}>0$ as well.
As
$$
\lim_{n\to\infty}a_n = \lim_{n\to\infty} b_n = 0
$$
we have $M, N \in \mathbb{N}$ such that for all $n > M$ we have $\lvert a_n\rvert < \sqrt{\epsilon}$ and for all $n > N$ we have $\lvert b_n\rvert < \sqrt{\epsilon}$.
We choose $P = \max \{ M, N \}$ then for all $n > P$ we have
$$
\lvert a_n b_n \rvert
= \lvert a_n\rvert \lvert b_n \rvert
< \sqrt{\epsilon} \sqrt{\epsilon} = \epsilon
$$
so we have
$$
\lim_{n\to\infty} a_n b_n = 0
$$
as well.