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Electrical Issue: lights are flashing and the horn is flashing with the key out of the ignition 850 1996

Bet it is the alarm going off! All 850's came with a factory alarm system. With the age of your car maybe there is a shorted wire somewhere? Disconnect the battery. Then check the wiring. My 95 850's alarm went off unexpectedly once. Unfortunately, I don't recall how I shut it off. My car didn't have a key fob. I'm guessing maybe yours doesn't either?

Checking the condition of the battery cables might be a diagnostic starting place. Not sure if this will directly affect the alarm system though. Have her look for corrosion and deteriorated wiring on the positive cable specifically. My 95's positive cable was nearing replacement before I sold the car. Sooner or later all battery cables need to be replaced.
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Will I buy another Volvo??? We'll see....






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