1988 2.7 6 Cyl Trans Problem

It won't go past 2nd gear, and when I try to reverse the car, it won't move. The transmission guy told me that I needed a new transmission or a rebuilt one. But a few of my friends told me that I might need a new trans timing belt. What do you guys think? I bought my car for $1600 4 months ago, it has over 177k miles on it, but the transmission costs around another $1600. Is it even worth it?

I have the exact same problem.....I have no idea what it might be..Anyone can help that'll be great..