Your friend will need to contact Shelter over this, as this is not unusual from the big lenders, and some may refuse to even discuss until the property is sold on and the shortfalls calculated, UNLESS the correct advocacy comes to bare.
I know that most councils will still work under the homeless legislation, which this is being sought, and they can put pressure themselves.
They will carry out an investigation to see if the evidence deems your friend to be unintentionally or intentionally homeless, and that can make hell of a big difference.
Shelter will be able to guide them and advocate as needed, and they can initially be contacted by finding their local advice point here
Want to talk to someone confidentially, without obligation and free of charge?
Abbreviations used in DQF
My advice is guidance only, if you want the law then consult a lawyer!
(c) All Spelling mistakes are my own design, infringement of them may result me sulking!