Jan. 27, 2009 -- Karen McHale of Idaho Springs, Colo., may have gotten the residential deal of the century Friday after winning a $1.25 million home for $50.
"I was in shock and just didn't believe it and then I was kind of terrified," said McHale, who won her new home after purchasing a raffle ticket for the house.
The story begins with Marylanders Tom Walters and his wife, Dianne. The couple purchased their dream house in Edgewater three years ago for $375,000 and decided to renovate the 1929 farmhouse.
"We just saw the potential and fell in love with it," Tom Walters said.
The Walters quadrupled the size of the home and invested $700,000 in renovations, which included adding 4,500 square feet. But they ended up saddled with more house than they could afford, in an uncertain market.
Walters told his wife it was time to sell their house but in an unconventional way.
"Not just sell it, but he wanted to sell raffle tickets," Dianne Walters said.
The Walters teamed up with a local charity called We Care and Friends, an organization that supports families dealing with poverty, drugs and crime in Maryland.
The Walters guaranteed the charity 10 percent of the ticket sales.
The grand prize was the 6,000-square-foot custom home that featured six bedrooms, 4½ baths and two kitchens in Edgewater, Md. All it took was the purchase of a $50 ticket for a chance to grab the Walterses' home.
"Rather than going out and getting financing of a million dollars, if you had $50, it could be yours," Tom Walters said.
For months, the Walters collected entries online and gave out 23,000 tickets, although they'd hoped to sell 31,500 (which would have raised about $1.5 million to break even). The raffle was Friday in an Annapolis mall.
"A very worthy cause makes good money, so that helps take the sting out of it," said Tom Walters, who is now in the market for a smaller home.
McHale said, "I feel horrible. I mean, I just feel for them."
As the home's new owner, McHale said she doesn't plan to move 1,700 miles to Maryland to inhabit the house but will flip the home to pay off her mortgage.
About 90 Days to Vacate
As part of the deal, McHale won't have to pay any mortgage, liens or closing costs. But she will have to shell out $4,808.10 this year to pay the property tax bill, which includes a homestead exemption.
The Walters family expects to be out of the house in about 90 days.