Hello I have a 1994 loyale wagon that over an 8 year period of rebuilding engine and other things I have it back together. Also it has 221k miles on original tranny. Ok the problem, it shifts and runs great in 2 wheel drive, but when button is pressed it shifts into 4 wheel drive but it feels like I just put the brakes on, it drags terrible, will hardly pull the car. Crazy thing is there's really no bad noise, vibration, you can just feel that something is just really dragging, not sure if that is the right word for it but that's how it feels. So does anyone have any suggestions on what might be wrong? I appreciate any help.

Are all 4 tires the exact same size?

Did you swap the whole LSD differential from an RX? Because if you did, it's the wrong ratio. Try putting the car on jack stands and see if it binds with all 4 wheels off the ground.

You could also try to remove the back half of the driveshaft (make sure to mark its orientation before disassembling) and see if it drags in 4wd without the rear diff connected. This will help isolate if it's in the transmission or the rear end.

Are all 4 tires the exact same size?

no everything is original, tires are all the same size. Like I said it has sat and not driven for almost 8 years in a covered garage.

Did you swap the whole LSD differential from an RX? Because if you did, it's the wrong ratio. Try putting the car on jack stands and see if it binds with all 4 wheels off the ground.

You could also try to remove the back half of the driveshaft (make sure to mark its orientation before disassembling) and see if it drags in 4wd without the rear diff connected. This will help isolate if it's in the transmission or the rear end.[/quote

No original transmission works fine in two wheel just when you shift in four wheel drive does it drag.

did you check the gear oil level in the trans?

 

drain the gear oil and check for debris, water, for bugs, etc.  add fresh gear oil.

 

you're positive it's the original transmission and rear differential?
 

have you ever driven this vehicle before - to verify positively it never had this issue in the past?

is it binding all the time or only around corners? 

 

how far have you driven it - like 10 feet or 10 miles?  

 

i wonder if just getting it moving and working the gear oil around might help?  

i wouldn't do that before draining, checking, and changing the gear oil though.