Tallon - It's usually that it won't select reverse that's the failure on these. (Not to say that the fault is as you describe).
If it is, it's the 'F' seal that's gone but it's a full gearbox strip and rebuild to fix, though there is a thread here on it. If you're near Chicago, then there's a man there known as Tozo on some of the forums who can fix these with his eyes shut
