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Grey sludge in coolant resevoir - what's wrong? 900 1994

Upon pre-purchase inspection of a 94 960 wagon I discovered grey sludge in the coolant resevoir along with clear green coolant. I looked at the oil filler cap and there wasn't any froth. I also pulled the trans dipstick which must have been designed by the mentally challenged and found clear red fluid. A mechanic came by and said that it was trans fluid in the coolant resevoir. The owner said that the radiator was replaced a year ago for unknown reasons. It is an all metal unit. Could it be that if the coolant intermingled with the trans fluid that it wasn't flushed out of the resevoir. The mechanic said that there is a valve that would prevent the coolant from going to the tranny. I don't understand this but since the sludge doesn't look or smell like oil I'm willing to beleive the cooler/radiator theory. I would appreciate any ideas and a explanation of how this happens. It will be looked at by a radiator shop tomorrow. I am still interested in purchasing this vehicle. Thanks.

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92 244 lowered, Bilsteins, IPD sways, Unitek cam/header, TSW Revo 18x8's - 76 Datsun 280Z lowered, modified head, cam, headers, intake






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