The board for Habitat for Humanity Edmonton said it hopes to settle a lawsuit filed by some of its clients out of court.
In Edmonton, 57 families have joined a class-action lawsuit over what they claim is the non-profit not living up to its agreements.
Habitat for Humanity works to build homes for those who struggle to save for a down payment on a traditional home. Instead of a monetary down payment, families must put in 500 hours of work — or “sweat-equity” — on their future home. In return, families received mortgages with no interest entirely financed by Habitat for Humanity.
The lawsuit comes after the local Habitat chapter announced late last year that it would be overhauling its mortgage program due to the $27 million debt it is facing.
In April, the non-profit said it worked out a new mortgage model that would have 50 per cent of of the mortgages coming from a bank with interest, and the other half would remain at a zero per cent interest.
On Monday, several dozen people took part in a demonstration outside the south Edmonton Habitat for Humanity ReStore, calling on the organization to live up to a deal made with homeowners.
On Tuesday, the chair of the organization’s board, Chris Bruce, released a statement that said that Habitat Edmonton now hopes to solve things out of court.
“The last thing we ever want to do is make life difficult for our partner families,” Bruce said. “We deeply regret the length of time this dispute has gone on without being resolved and the disappointment this has created for both the families involved and the larger Habitat community.
“It is time to move beyond court proceedings to resolve this situation for the families. We agree that mediation is the best path forward and look forward to hearing back from the families’ lawyer about initiating mediation.”
The organization said that any families involved in the lawsuit are being invited to participate in mediation.
It had also previously confirmed to Global News that no families, whether they are renters or have a mortgage, will be asked to leave their homes.
Habitat Edmonton also announced Tuesday that its current CEO, Karen Stone, has stepped down from her position.
The organization previously told Global News it is facing debt because under half of the 50 houses it build in the Edmonton area each year are covered by donations.
The non-profit had been borrowing money to bridge the gap left behind after donations and fundraising.
–With files from Phil Heidenreich and Sarah Ryan, Global News