I selected Range-Doppler Terrain Correction->External DEM. My DEM is .img format and the external DEM no data value is -3.402823e+038. But it prompted a SNAP error telling me that unable to download Index of /auxdata/dem/egm96/ to null.
The terrain correction UI currently has some issue with the “Apply Earth Gravitational Model” checkbox for external DEM. For now, could you first select this checkbox and then unselect it before you click on the “Run” button? After that, you can click on the “Run” button to start your normal processing. See if this workaround helps.