I think my trans is on the way out. We went out Friday for a nice cruise and on the way home started to notice when slowing down to turn or come to a stop the trans would not down shift from 2nd gear and could hear a loud grinding and clunking noises. Pulled the dip stick when I got home the fluid was a grayish brown with a lot of metal in it.


Question is if it is broke is it worth putting a new TH350 in it? Or would it be worth doing a over drive trans? Also should I upgrade to a higher stall torque converter?

 

Rebuild, new reman, or new OD your choice they all have their pluses and minuses.
Do you care about the numbers matching? Do you want hi-perf dyno tested? Do you want OD. TCI, Hughes, B&M etc...offer great warrantied trans and converters dyno tested and drop shipped. Your local re-builder may be able to do the same to yours if you want to retain the original case. Or scrap that and go with an OD. Also consider a Gear Vendors OD unit bolted to the back of a fresh TH350. The GV is like a 6 speed as it splits the 3 forward gears.
Do some homework on the gearing advantages of all three along with the converter and rear gearing combos. They all need to harmonize. The cam and your driving style will dictate things as well.

 

Rebuilding a th350 is pretty easy even making minor modifications. I have about 350 into a th350 I built as a back up to my curent th350 and I did a shift kit , extra clutches , hardened sprag , 700r4 center support. Should be pretty good. My curent th350 just has extra clutches and a b&m shift kit. That rebuild cost me 250 and I have been beating on it all season with no issues.