Buying a buddy's 1991 f350 7.3l idi. The original motor was pulled when running, was burning coolant but ran. So he picked up another motor and dropped in it. Then as we were filling the radiator (8gallons). Within the last gallon it started to poor out of the oil filter housing. No filter or oil in the motor. My question is what could cause this?

 

If it came out of the oil filter housing that indicates bad seals in the oil cooler. The oil filter attaches to the rear header of the oil cooler afterall.

 

Not to mention it filled the oil pan too

 

Your oil cooler ends could have cavitation as well, be sure to check them over REALLY good when changing the seals.
The center cartridge could be bad too, I think ford wants $250 for one last time I checked

The end towards the front of the motor is still available from ford, the end with the filter on it is not so you'll have to find one at a junkyard if it's bad or ask in the parts wanted thread at the top of this page.

 

Would that cause all coolant to fill the engine in the matter of an hour?

 

Gravity...

 

6.9 and 7.3 IDI Oil Cooler Repair ? IDI Online