Click and grind plus brakes

[57sweptside]

I have a 2004 Explorer base electric select 4x4 with 220,165 miles that I picked up from a post office auction. My plan was to give it to my 16-year-old as a daily driver. I didn't have the opportunity to test drive or even hear it run before I bought it but for the price I paid ($500 - RUNNING with a jump, rust free and apparently complete) I figured I had a little room to fix any problems.

The first issue I noticed was that it will not go into reverse. As soon as it is in R, the grinding starts. It sounds like a gear grinding - like it cannot engage. I Googled the symptoms and looked around here and it sounds similar to what Gen 2 Explorers go through with the fork thing. Is that still a thing in Gen 3? When I jack up the rear end and spin the wheels (they spin in opposite directions) I hear a definite click in the transfer case area - like Wheel of Fortune!

Here's the kicker. When I shift into 4Low, it shifts into reverse PERFECTLY! 4 Auto and 4 Hi give the clicking in reverse, but 4L is fine!

Problem #2 is that the rear brakes are dragging. I assume that it is the emergency brake since BOTH rear wheels got VERY hot after driving about a mile. There was a clear drag as though the brake was on but the e-brake releases fine. The brake light is lit on the dash. The forum here has posts about shoes falling off, but not getting stuck. The 1A Auto video makes it look doable but does anybody have any tips?

I'm fairly mechanically proficient so I'd like to do as much of the work on my own as possible. Does anybody have any suggestions for either issue?

 

[MrPulldown]

If you are changing out the e-brake pads it is a total PITA. There are alot of fishing around to get all the springs an cams in place. Buy the additional hardware kit. Though some of mine were reusable, most were heavily rusted, and I was glad to replace all the little bits and pieces. Next have a couple of long handled/tipped needle nose pliers. THey came in handy. I posted about my job on this forum last summer when I did the job. Maybe I had a few more tips in that thread. Search it out.

 

[57sweptside]

If you are changing out the e-brake pads it is a total PITA. There are alot of fishing around to get all the springs an cams in place. Buy the additional hardware kit. Though some of mine were reusable, most were heavily rusted, and I was glad to replace all the little bits and pieces. Next have a couple of long handled/tipped needle nose pliers. THey came in handy. I posted about my job on this forum last summer when I did the job. Maybe I had a few more tips in that thread. Search it out.

Thanks! I'll check it out.