Loud Violent Clunk When Shifting FMX Into Gear. Any Transmission Experts?

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TBH, that is a lot of movement in the diff. Here's a video of the 2.75 rear I just removed from a car. I consider this excessive, and yours is much worse.


It doesn't take much wear on the differential bearings to dramatically increase the backlash. Harsh transmission engagement with a small amount of backlash will make a noticeable bang.
 
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