I recently heard my front brakes start grinding, I thought maybe I just needed to replace the brake pads, but tonight while driving I heard a loud clunk and my brakes got soft like I blew a line. So I put my truck in park and got out to check it out. When I got back in and put it in drive, I had brakes again and as I drove it started grinding very loudly and when I push on the brake pedal it squeals.
What most likely happened is one of the linings rusted off the backing plate. The piston works its way out as the lining wears down. That's the self-adjusting feature. When the lining breaks off, the piston has to move out anywhere from 1/16" to 1/4". To do that, a lot of brake fluid has to fill in behind the piston. That's why the brake pedal goes down so far. Once the piston makes contact again, the brake pedal will feel normal, but now there will be metal grinding on metal.
We also see this when the grinding was ignored for along time. Eventually the rotor wears down to the cooling fins. At that point the lining's backing plate or the piston will turn and catch on them causing that wheel to lock up.
Be aware too that the master cylinder can be damaged if the pedal goes more than half way to the floor. It doesn't matter if the pedal went down when this problem occurred and surprised you, or when you're bleeding the brakes after replacing parts in the hydraulic system. Crud and corrosion build up in the lower halves of the bores where the pistons don't normally travel. When the pedal goes past half way, the lip seals run over that crud and can be ripped. If it comes to needing to bleed the system, all I do is gravity-bleeding with no one pushing on the brake pedal.