2 litre Zetec on carbs, or fairly standard.

Don't go turbo - the power delivery of a N/A in a lightweight XR2 will be much more applicable.

Getting a loan to build an engine is crazy in my eyes - the return in performance on the hassle of owing money doesn't make any sense, especially when you consider that a simple standard 2 litre will make the car ridiculously fast!

You're far better off getting the 2 litre in and running, and learning to drive track really well, and you'll be passing cars with twice the power, and it'll have cost you 1/10th of the money.

It's all about the FUN mate, and never about laying out more money you don't have to achieve the same goal! Funnily enough, more power often equals less fun when it ends up costing you more money (which you'd have to borrow), the noise issues on track, the way the car lays power down (especially when turbo'd) etc etc..........

Stick the sensible hat on, and it'll pay dividends in the long term.