About to purchase this 1998 Jeep Laredo

I’m heading over to purchase this 1998 Jeep Laredo and one of the photos online showed this leak on the underside. Any idea what it might be?

Looks like the transfer case is leaking.



Appears to be coming from the transfer case, although it could be leaking farther toward the front and blowing back. I would guess one of the output shaft seals on the transfer case is leaking, but you’d need to inspect a little further in order to know for certain.

Looks like a pretty decent sized leak. I’d be concerned with that. They could have ruined the transfer case driving around on low fluid.


Wow, the underside looks like brand new for a 20 year old vehicle. Where is this?

Yeah, the transfer case looks alittle leaky but that spot on the floor is not under the T-case. That might be a little moisture from the exhause from a cold start and nothing to worry about. If it feels oily, it is likely T-case, wet is likely exhaust.


Yea the car has 89,000 miles on it but it’s in great condition otherwise

the wet on the floor is probably from the exhaust. but there is oil residue on the transfer case. it could be leaking or from an old leak and never cleaned off. something to check out.

If the oil is only on the back side of the transfer case, it’s probably the output shaft seal. Would not be a huge repair if it is only that seal. Would be nice to be able to check the fluid level, though.

Changing the seal (if it is the output shaft seal and you decide to buy it) isn’t very involved. Remove driveshaft, pry out old seal, install new seal, reinstall driveshaft.

That spot on the ground does look a little more “splattery” than an old oil stain would appear. May be water like others said, now that I look at it closer.

All I’m going to say is based on Jeeps reliability reputation is, good luck.


But, if the OP does decide to proceed with the purchase, I strongly suggest that he do a test drive at highway speed, just to be sure that this old Jeep doesn’t display what is known as Jeep Death Wobble. While it is most common on Wranglers, any Jeep model can have this problem when front end components are badly worn.

I wonder why no one mentioned the most obvious suggestion as in having a independent mechanic do a pre purchase inspection.


Yep, PPI, preferably by a Jeep mechanic.


The '98 Cherokee and Grand Cherokee have independent front suspensions so I’m pretty sure they are not prone to death wobble.

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Pretty sure the first gen Cherokee never had a independent suspension on 4WD models. They had Dana 30’s IIRC. The 1998 Grand Cherokee would have the same one.

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I would ask them to fix the leak before I buy it. Looked at one that had try to seal the leak with bondo. Do not want to step into trouble on a used car myself. Independent inspection, may need brakes, tires, trans fluid change, coolant flush etc. Know what you are stepping into.


If there is a big leak in t-case, it might be empty. Or close to empty.


Oops. You are right. I was thinking of a newer generation.