1987 Plymouth reliant k LE wagon. engine knock?

i just bought it for $1,000 cause i really neededed something better on gas for now, so i kinda looked over the kncok cause it has had it for over a half a year. it sounds like a diesel at first until it starts to heat up, then it turns into a faint knock. the temp gauge also will read hot if the heater isnt on, the fan works and i put in a new thermostat. what would cause a knock like this and would i be fine for a year or so, and is the car really getting hot or a bad sensor. i can touch the hoses and ther warm, not actually hot or ballooning at all. its got 127,000 miles. good buy?. any info would be great!