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Cam noise

You can do a compression and leak down test on the "new" motor while it's on the bench. For me the "new" motor is suspect. No motor from the factory is never fired, and whichever bike it came out of was test ridden by the dealership.
 
New motor was sold to me as a NEW never fired motor. It was pulled out of a new bike and replaced with a 120 that was seating on the shelf. I though it was a great deal so I bought it. When I got it here a friend took one look at it and said that it was rebuilt. (New silicone between cases.) My friend said it was still worth the money I paid for it.
Motor in bike was running. I pulled it out to check it out and see what was wrong with it.(learning hard way!!)

If the new motor was never fired, the case sealant would be new; that is not the way to determine if the motor is new or rebuilt. What do the exhaust ports look like? You can look at the top of the piston with a lighted bore scope/digital inspection camera; you can pull a head if necessary; lots of ways to tell if the motor has ever run.

However, I would do as othes have suggested and open the cam chest. The inner cam bearings could have failed but that does not necessarily result in damage to the bearing bores which can be repaired as opposed to purchasing a new set of crank cases; you can't just buy a right or left side case as they come in pairs. I would guess that a new set of cases would run about $700 from a discount dealer.

If you can repair the damaged motor, you can always resell the "new" motor but you would have to do inspect the motor as suggested above to sell it as new and never run.
 
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