Don't cut the loop!!! Crawl into the back of the car with a T40 driver. Lift up on the spare tire cover to access the two screws holding down the latch loop. Be careful not to disturb the dirt around the loop so that you will know where to put it back. Too much tension will lock it up again.
The latch mechanism can be seen if you take the panel off. There is a metal rod that slides down on the driver's side of the latch. It is held in place by a small piece of plastic. Once that plastic piece breaks off, you will need to replace the entire latch mechanism!!
For others reading this post: Do NOT slam the lid shut with a lot of pressure against the lid. This may cause undue pressure on the metal rod and break off the plastic which the rod uses to position itself against the unlocking lever.
Klaus
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(V♂LV♂s 1995 854T, 1998 V70R)
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