rear differential

My 2001 4WD needs a new rear differential. The "spider gear" is torn up. Is this a common problem? I only have 61,000 miles on the truck!!! The repair quote is $4000. for new replacement or $2400 to replace new insides and use original housing. My USELESS extended warranty is offering to replace with a used differential that has 50,000 miles for $1100 and change. Any advice? I'd really like to know if this is a common problem.

I can't imagine that being a common problem. I'd at least get a second opinion. Unless they're claiming abuse, I've got to think this is a drivetrain issue that should fall under most extended warranty plans. It might be worth your time to ask the warranty provider to reconsider - perhaps escalating the issue within the company. Good luck...please keep us posted.

Take care,
Jerry