USDA Property in Interest only loan and negative equity?

[Jay Statzer]

OK here we go. My first technical question.
My neighbor has a home with a USDA loan plus a loan for a 4 yr old roof equaling 78000. He pays $450/mo interest only. So, basically, is he just renting the place from USDA?
So he's fixin' to die soon and his disabled wife can't handle upkeep and wants to downsize -the easy part. How can I help them get the house out of their hands with an estimated ARV of only 65,000? I know there's worse situations that are selling but what to do here when USDA specified no transferrals nor subleasing?
I have a calculation sheet I can email on request, don't want to post anything that will get me accused of spamming or advertising. Just want answers.