Guys. what makes you think its a chain and not a drive shaft issue when you hear the "ratcheting" clicking sounds from under vehicle when you switch from Park to Drive or Drive to Reverse or any combo of that nature?

The driveshaft spline will get worse REALLY fast (vehicle will be un-driveable in a few days), the tc chain ratchet will remain constant for months.

There is no warning on the drive shaft. Splines don't slip, they simply fail.

2002 X5 3.0 291,000 miles
2014 428i 12,800 miles
2004 325i sold at 123,600 miles (currently on eBay)
2001 325i sold at 66,000 miles

The TC seals were the one item the dealer added when they installed the used case for my drive shaft repair. I guess it paid off since I haven't had any leaks in 155,000 miles since then.

2002 X5 3.0 291,000 miles
2014 428i 12,800 miles
2004 325i sold at 123,600 miles
2001 325i sold at 66,000 miles

Yeah its on the back half, right above the drain plug. Mine is the NV125. Im not sure exactly what uses the other one.

Sorry to bring up an old thread but I thought I would update on the issue/solution. It turned out to be the transfer case chain. I bought the replacement chain from cobra transmission for $93 shipped I believe. I also ordered a set of external spline sockets on amazon for $15 to get the bolts off the transfer case. Took me about 8 hours to get the whole job done with the help of my 13 yo brother. Hardest part was the exhaust bolts on the header which got rounded off and needed a $20 set of stripped nut sockets from harbor freight. The whole procedure was relatively straight-forward. I used this thread as a guide: http://www.xoutpost.com/bmw-sav-foru...-pictures.html

Thanks for all of the input and help!! :thumbup: