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Nice story, are you asking for help or what?
 

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Loud bang....no 4 wheel drive....hmmm...I'm guessing its the biaxle manifold. Or the retroencabulator.
 

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$20 says your collar gear just went. Happened to me too; it's kinda like an R rite of passage thing, up there with your first freaky experience of sidehop, or the 'demons trying to escape from hell, right under your car' noise that is so unassumingly termed 'rain squeal'.

-Steve
 

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Get the car on a lift with tires free. Put it in gear. If drive axle spins it is your rear diff. Could be pump, or dem. If the axle does NOT spin its likely the angle gear sleeve.

Sent from my SGH-T999 using Tapatalk 2
 

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My suggestion is from my best friend /indy mechanic/ former 10 yr master volvo tech. That's what we did to determine my aoc pump was bad.

Sent from my SGH-T999 using Tapatalk 2
 
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