Free House? Be Careful What You Wish For
CNBC Real Estate Reporter
Late last year I did a story on a guy who was raffling off his million-dollar, Maryland home because, thanks to the housing crash, he couldn't sell it on the open market. In January, the lucky winner, Karen McHale, who lives in Colorado, bought the ticket as a charitable donation, and never intended to own a home in Maryland, suddenly found herself in quite a conundrum. Yes, she won a house that was once, and I repeat once, valued at a little over a million dollars, but she had no way of selling it and no means to pay the property taxes, income taxes and maintenance on the property. You see, like millions of other Americans, she lost her job shortly after she won the house.
Well, here comes the happy ending, I think.
After much angst over her finances, McHale finally sold the house to United By the Bay Church in Severna Park, MD for $650,000. She then had to donate $200,000 to the church to offset the IRS bills. So in essence the church got the property for $450,000. Nice for the church.
In the end, McHale did end up with $200,000, this after her husband had to do substantial work on the house, and she had to endure months and months of stress over how she was going to pay an estimated $300,000 in income taxes if she couldn't sell the property. The "winnings" helped her to pay off some of her own mortgage on her Colorado home and various other things for her kids.
Worth it? You tell me.
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