It could well be that the head gasket has gone, probably because it has been allowed to run short of oil and coolant. Many folk forget to check their oil and coolant levels weekly. It doesn't matter about the mileage. Fluid levels can fall causing the engine to overheat and if weekly checks aren't being carried out severe damage can result before any symptoms appear. Too late then. It sounds as if your engine has run short of oil and/or coolant.
Regular maintenance is much cheaper than a new engine.
ChicksFan, December 2014