I agree with pbkmaine, never lend money. You should only give money to someone if it is a gift. I did give $2000 to a co-worker/friend once. She called it a loan, hoping to pay me back, but in my head I called it a gift. I gave it freely because I could easily afford it and she really needed it. She paid back about $ 400 of it in the end, but because I had thought of it as a gift all along, I was able to reassure her that I did not need her to pay the money back and we maintained our friendship.
Either give the money as a gift, or get married now, or don't lend the money. No, I am not kidding. If you are really that committed to each other, go ahead and get married. If you are not that committed, only give BF the money if it is truly a gift.
It sounds like BF has a LOT to deal with now. Grad school can wait a year. He should get a deferment, work a year, save money and get his affairs in order. Going to grad school with so much of his life in turmoil is not a good plan. Also, if he cannot get a position as a teaching assistant or some sort of scholarship to grad school, is it really a good career path? It may be--if it's something like a physician assistant masters or other program where there will be a job waiting. Has BF negotiated as much as possible regarding medical debts? Is the house going to be rented out? Is he hoping to negotiate forgiveness of debts on behalf of his father with family members? All of that needs his attention now.