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First, confirm that your motor actually threw a rod. It does happen, but's it's not common.
Second, shop around a bit, pricing good used motors. Expect around $500, but prices do vary. Shop around but don't buy. (I got a '91 740 engine and tranny, complete, 140K miles, for $100 -- which was merely the labor cost to yank and deliver it. No, it's not for sale.)
Third, consider another mechanic. Your guy should not have suggested rebuilding, which he certainly knows is obscenely expensive compared to buying a good used motor. (Unless, that is, he really wants your car, and he's trying to manuever you into becoming discouraged and selling it to him for scrap value.)
If a second opinion confirms the first diagnostic, then think seriously about a motor swap (because you want that car). But if the second opinion is different, then maybe you can repair the existing motor.
--
Don Foster (near Cape Cod, MA)
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