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it's worth taking the risk and throwing new exhaust on the failed side and seeing what she does with a load on. The most that's going to cost me is $300 bucks
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Worst case scenario it blows up [img]/forum/images/graemlins/tongue.gif[/img].
You take off all the usable parts and sell them on craigslist. And recoup most if not more than the $300.
Mercury has a deal going that if you buy a reman. by the end of the year you can get an extra 2 years of warranty...extending out to 3 years.
What ever you do don't toss the block.
Mercury's new policy is that if you want a 350 w/o catalytic converter. You have to exchange your old block for the new one...(not sure about the parts).
There newest set up is a 377 with a catalytic converter. Its on there website. I went through this on my engine buy.