I was able to get the transfer case torn down, and all of the components look to be in great shape. I did end up ordering a chain for good measure just in case the old one was stretched a bit.
I decided to redo the u-joints including the centering yoke on the front drive shaft.
I think this could have also been a culprit in the loud banging.
I have a question about that ball in the centering yoke. I ordered a new one and the ball is so stiff and cannot be moved. Is this normal?
The old one moves very easily and I'm wondering if that is part of the issue.