Heater core leaks are common on these models. Fortunately, replacement cores are fairly cheap and easy to replace, relative to most other cars. See www.fcpgroton.com for prices. You would probably smell coolant inside the car and/or experience foggy windows if this were the problem, though.

Radiator leaks are also not uncommon, although that has less to do with faulty radiators than it does to do with a front-end design that leaves the low-hanging radiator vulnerable to parking lot curbs and resulting hair-line cracks. I replaced mine for about $220 plus a couple of hours of my own labor.

Finally, my upper radiator hose had a leak at the radiator-side clamp. I replaced all of the rad hose clamps at that time, and didn't have another problem until I found one of the aforementioned curbs about a year later. ;) Regardless, check your hoses at the clamps, and if you can't find the source of a leak, pull the lower engine cover and check the radiator itself for slow, seaping leaks.

--
Jim Rothe, '99 S70 T5M,
http://www.jimrothe.com/volvo/index.html