Help!

[Tuti 0]

I am the US Citizen petitioner. my fiance came to the UK as student and was out of status from 2011-2014 but in 2014 he put in an application with the home office to legalize his stay that application is still pending

Will the embassy issue a K1 if the applicant is out of status in the UK but they have a leave outside of rules application that is pending with the home office?

Interview was today case is in AP With the passport returned pending a document from the home office with status of leave outside of rules application. We have a letter from home office from October 2014 saying the application is being forwarded to a case work unit. We called today to check on the status and were told the case is still in process.

We are planning on submitting the letter tomorrow
what else can we do to help our case?
How bad is this?
Can we ask them to transfer our case to my fiance's home country if his residency in the UK is an issue for the CO to issue a visa? How do I do this?

I found visa journey too late!