D40 4wd warning light

Good day mates, earlier today I saw my 4WD light came up on the dash, carried it by the dealer to check. They found water in my transfer case and recommended that I change the transfer case, because if the oil and sensors are changed the 4WD light (error) would still show up. Need some serious advice here. The dealer quotes me a transfer case at a discounted price of 22000 dollars (3000aus)

If there was water in there, there's no telling what damage it's done. Imagine the bearing surfaces may have started corroding, the shafts, the chain links ... and of course the sensors, which will end up with dodgy contacts forever.

Dismantling it and meticulously inspecting and cleaning every component is your cheapest alternative but the damage may already be done. A new transfer case is the most efficient way to fix the problem. You could chance it with a second hand one. It's worth sending a pm to Nizzbits on this forum and asking for his price on a new one.

Thanks Old. Tony for the feedback.

Bit of a late reply mate, late last year I done a trip from Canberra out to Innamincka and down through the flinders. About half way down the western side of the flinders I had my VDC, Traction control and ABS light come one. I called Nissan once back in reception and they said bring it in when you get back. Which I did. Ends up I need a new transfer case due to an "electrical fault" it goes in tomorrow to get replaced under warranty luckily!

They said to me if it was out of Warranty it would be around the 13k mark., warranty price to Nissan was 8k. Hopefully they can give me more detail an what had exactly failed.

When all the lights came on I was in 2wd on a corrugated dirt road, nothing very exciting at all.

Ever since, Sometimes the warning lights come on and sometimes they don't. I haven't used 4wd since to ensure no further damage could be done or that off chance I got stuck in 4wd.