If it is a heater valve, you may be able to temporaraly stop the leak by driving with the heater on full. AyeRoll taught me that trick when I blew mine.

The easiest solution is to take a bit of hose and just join up the heater fittings on the motor. We did that with my car, using one of the original engine to firewall hoses.
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Drive it like you hate it

It's most likely the heater valve.

Cheers

Yep they have indeed sprung a leak,, the thing thats next is to replace it,,Oh boy I can't wait till you start that one..Its the mother of all Volvo jokes.. Yes sir Sweven is sitting in the little Volvo design room laughing his a double s off.. That was his idea to put it there.. Ok just start posting your questions and you will get all the help you will need for the two week project...And do like all the rest of us and get lost fixing every little thing while you have the dash and console apart. Oh yea make sure you clean out behind the heater box, it will have leaves and pine needles and lost socks and hmmm a baby rattle?? Never mind, its late and I was bored for some fun.. good luck,,,,Max
P.S. there are several posts on this board with pics showing the way to do it.. Pul the dash for the best room to work,, only takes an extra 15 minutes..
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Max..1989 244 DL 5 Spd., Bilstein HD, Turbo Swaybars, Poly Bushings all round, Turbo Wheels, Black leather interior, Electric mirrors, LED dash and gauge lights.

Your heater core and/or hoses and heater valve have sprung a leak