My best friend has gone deranged

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He has been my best friend since high school and that's counting to more than twelve years now and it's really a tragedy for me. It all started last month, and I believed depression caused it. My best friend was a vocalist in a band and at that time he had a girlfriend and all was well until he and some of my friends had an accident. All before this, there were already symptoms because he was being too paranoid on all things and he claims that he has been hearing insults and comments about him, which didn't really occur. Well, the accident included his band members and he was driving the vehicle, nobody from their group really got hurt, but there was a passer-by that got hit and hospitalized. It wasn't really their fault because, according to the story, as they were turning left a fast approaching vehicle hit them, which pushed their vehicle to hit the one on the motorcycle. Anyway, there was a lengthy arrangement, which included payments and help from the bandmates and after that my best friend decided to leave the band. He told me that there was no longer support from them and that he was feeling unwanted. This was all where it got worst. Following that, he broke up with his girlfriend and haven't heard from him for a while. Next thing I found out, he was mentally unstable. It was really hard for me to believe because it was only just more than a week before that he came to my house and was still all normal, so I visited him at home, he was calm but he really wasn't the same anymore. It was hard talking to him because according to him, there was another entity that he is talking to and must obey. I later found out that he had a long-time crush on my sister and this is where everything gets heavy and bad. When I spoke to him he told me that he must marry my sister, and I really didn't know what to say because my sister is still too young to marry. He insisted on this and I just remained his friend all through this. He would stalk my sister and approach her and ask her to go with him, and this really scared my sister. I went with him to see a psychiatrist and it was depression all right. Nothing really changed after that, at first I thought he was back to his normal self last week when I went to visit him with some of our common friends, because he was acting all normal and usual, but two days ago he came to my place and he was cheerful until he saw my sister. He wanted to talk to her and wanted to grab her, my sister ran to her room and he wanted to get in. I told my friend to go home, as I too was sick and in really bad shape, so I couldn't attend to him. It was really a long night, and I was really restless. Yesterday, he came banging on our front door, forcing himself in. I opened it and he pushed me, I managed to block the way and told him to leave. I got my right hand joint injured, sort of sprained, from his push. I feel so bad for him right now and really helpless. He comes from a poor family so I know his mom couldn't afford medical treatment. I am jobless and I couldn't afford it too, because if I could, I definitely would. I don't know how he is doing right now, but he is still my best friend. We've shared many things and I understand what he's going through. I just hope it's not too late for him yet. I wish I could do something for him now. So, to make this a discussion, what would you have done? Have you ever had any friends or relatives of similar condition?