Your friend did interest based dealing that he took loan from bank to buy the house. He should do taubah and istighfar for the same. He should pay the loan back as soon as possible and be free. If the said friend is indebted and indigent then interest money may be given to him without the intention of reward. It is not necessary to tell him that it is interest money. He may use it where he wishes. The interest money should be given into his complete possession. It is not right to give him as loan.
Allah knows Best!
Darul Uloom Deoband