The halfshafts are likely dead since the boots are torn and missing. Teh good news is that you can continue driving as long as they are not too noisy. They will click/pop some as they wear and then eventually start rumbling/roaring when they get really bad. Never heard of one damaging a rear diff or falling out completely. They are fairly easy to replace and there are many threads on the topic so do a search. Carquest had remanufactured halfshafts for $69.95/each with a lifetime warranty. You will likely have to order them though, takes a few days. RT
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