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200 Max 1/2 NL, 5 handed. Villain is well, I have seen better players before, but he isn't a total donk. He hasnt done much out of line play, however, prior to this move. He is the newest to the table at about 60 hands.
Anyway, villain has $200, I cover.

PREFLOP
Hero limps utg w/7 [img]/images/graemlins/diamond.gif[/img]8 [img]/images/graemlins/diamond.gif[/img], 1 fold, 1 call, villain completes from sb, bb checks.

FLOP ($7.20)[4 [img]/images/graemlins/heart.gif[/img],K [img]/images/graemlins/heart.gif[/img],5 [img]/images/graemlins/diamond.gif[/img] ]
Villain checks, bb checks, Hero checks, utg+2 checks.

TURN [4 [img]/images/graemlins/heart.gif[/img],K [img]/images/graemlins/heart.gif[/img],5 [img]/images/graemlins/diamond.gif[/img] ,3 [img]/images/graemlins/diamond.gif[/img] ]
Villain checks, bb checks, Hero checks, utg+2 checks.

RIVER [4 [img]/images/graemlins/heart.gif[/img],K [img]/images/graemlins/heart.gif[/img],5 [img]/images/graemlins/diamond.gif[/img] ,3 [img]/images/graemlins/diamond.gif[/img],4 [img]/images/graemlins/diamond.gif[/img] ]
Villain bets $60, bb folds, Hero?

Ok, I should have bet earlier, probably the turn with gutshot + flush, but seeing as I didn't......fold, call, or raise and why?