My Explorer has started a loud whirring sound preceded by a couple of klunk sounds. It will only quit if you completely stop the car. Before the mechanic heard it he thouht maybe a belt problem, but after hearing it thinks maybe the automatic 4wd is trying to engage, but can't. Any ideas?

So I took it to the dealership and they think it is the transfer case. $2500. Help me out here. Are there options? I'm clueless.