After avoiding and furnace disaster, we have decided to replace our current 18 year old furnace with a TRANE. I do not want to buy the most expensive model unless there is a concrete reason to do so. Which model would be the best for our house. Our house is approximately 1800 square feet and is a split level. Is there really that much difference between 80 & 90 % efficiency? Also we live in the mid-atlantic area. Should we invest in a heat pump?

Trane, American Standrard are the same manufacturer, Rheem, Ruud are also by the same company. For many years these have been the two most highly rated furnaces in the industry, so I think you are making a good choice, Rheem is often more affordable because they don't spend as much on marketing and the contractors have better cost control over what they want to charge, just a suggestion.

80% means about 19 cents of every dollar you burn goes outside, in a 90% about 8 cents of everydollar goes outside. There are other benefits to a 90% efficient furnace. Fresh air for the combustion is pulled from the outside in the 90. For example in a 80+ furnace for every cubic foot of gas you burn 14 cubic feet of air has to be used for combustion, if this air is coming from your living space, this is air you already payed good money to heat and condition that is being wasted. Also, direct current "smart motors" available in these new units use far less electricity than the blower motors of old. Example, a Rheem modulating furnace in low fire used aprox' 75 watts of power vs. 800 watts in the older models. Heat pumps are very efficient to operate down to about 30 degrees, they are nearly twice the price of an A/C unit tho. If you go for the heat pump I suggest you get the highest S.E.E.R. rating your budget will allow, actually, I know of some of the advancement coming in A/C and heat pump tecnology and might consider waiting another year or 2 to buy one.

Yes, I am a Rheem dealer, I used to be a Trane, Carrier, and back when I started this field of work, a GE serviceman. I have no problem selling Trane or Rheem to my own mother. My bias is based on years of service issues as I service all brands. Some things are just engineered better. Every brand I can think of has had lemon models, so I like to see them field tested for a few years before I go out and get the newest model.