Hi, we have this BMW 3 Series Conv.. The previous owner used it as a daily driver and as a everyday used vehicle. It ran great the day I bought it, but recently white smoke started coming out of the exhaust. It’s most likely, coolant being burnt with the fuel. I think the cylinder head and gasket have been ruined from overheating.

I looked under the hood for the first time since I bought it and noticed that caked on dirt was in the coolant reservoir. The radiator was brownish inside – I’m unsure if this was mud or rust. I drained the radiator and mostly brown liquid came out. Once it dried out, there were little brown flakes on the inside top.

Should I get the engine replaced (3 series expensive), or take a risk and just replace the cylinder head and gasket (cheap)I dont now the cost of BMW 328 cylinder head gasket? Also could the water pump have failed from rusty coolant circulating through it?

Any help will much appreciated,I’m looking for an affordable solution (nothing unnecessary).

 Perhaps it had a problem and the previous owner just dumped some hardware store sealant crap in it.  Try stopping by a radiator shop and asking, maybe a complete flush and then a pressure test.  That would narrow down your options.  If the head is cracked - you need a new one.  If it was just a gasket leak that's a lot less than a new or rebuilt engine.

Oh yeah,  Don't drive it.  It will NOT get better and very bad and expensive things WILL happen.