I had one for a while. Is the gear shift floor mounted or console mounted? Floor mounted is Phase I and console mounted is Phase III. 1989 is the changeover year, and it could be either model, depending on when it was made.
Phase I is earlier and Phase III is later. Phase I uses separate shuttle shift tranny and rear transmission, and Phase III uses integrated shuttle shift transaxle. They use different transmission fluids, so it is critical on this model that you know which one you have. The Phase III has wet brakes and the other uses dry brakes. Wet brakes probably work better, and last a lot longer, but you don't EVER want to have to replace them. It requires unbolting the transaxle from the tractor, lifting the tractor and completely removing the stub axles.
Personally, I prefer the earlier version. They are the same transmissions used on all prior Case backhoes, starting with the "C". Easy to fix, and many used parts around. The later tranaxles are Italian made, and used on all later models up through the current "L" as far as I know. They work well, but plan on spending big bucks if it ever needs repair.
Other than that, look for cracks in the upper loader pivot arms. These are fairly common, and often welded. They don't seem to cause major problems if not overly abused. Also, look for cracks in the cross brace at the front of the tractor between the loader arms. Not real common in the "K", but very common in the earlier models. With each newer model Case reinforced this area more and more. It is very uncommon to have cracks in the backhoe area, except sometimes at the end of the boom, where the bucket attaches. Earlier versions had various weak points, but with the "K" model, Case introduced the cast steel primary boom, with a single interior cylinder. These things are virtually bullet proof, versus the previous welded steel booms. Look for excessive play in the pivot areas, as this indicates heavy usage or poor maintanence.
It has a very good Cummins engine in it, as Case every model starting with either the "E" (I think) uses this engine instead of the earlier Case engine. It is fuel efficient and starts w/o glow plugs down to below freezing. It is best to plug it in if it gets real cold, though many included ether injection systems to help start them.
Most of these have the Case 4 lever controls, but some had the John Deere 2 lever controls, which mine had and I think are much nicer and easier to use. This was an added cost option.
Is it 4x4? What is the price?
Good luck and happy digging.