Why is there red residue under your radiator cap and in the overflow tank?

You may notice that the color of "red," being described is very close to the color of rust. If that is the case, then 1+1=2, right? If the cooling system is properly filled with an appropriate mix of coolant and water then this should not occur. There are three elements required to produce rust... Iron, water and oxygen. If the cooling system has not been properly filled (to include purging all the air from the system) then rusting can occur. This can occur within the coolant passages of the engine block or within the water pump housing. Since the passages inside the radiator are typically copper or aluminum (as well as in the heater core) the source of this "rust colored residue," is coming from within the engine block itself. It can also indicate a poor seal. For example, the radiator pressure cap seal. When the engine begins to cool, the molecules begin to contract and you end up with a sort of a vacuum. Air can be introduced into the cooling system, past the radiator cap, as the fluids begin to cool. Normally, one would notice the opposite effects of a bad seal while the fluids are hot and creating pressure because the fluids would likely leak out. When pressure is lost in the cooling system via a leak, the boiling point of the coolant decreases and overflow occurs more easily. Try flushing your cooling system and refilling it. Ensure to follow manufacturer guidelines on bleeding the air out of the system. If possible, have the cooling system pressure tested to check for possible leaks. If that's not an option, then monitor the coolant in the engine and if the red discoloration continues (after having bled all the air out) then start investigating all the seals for leaks. Hope this helps.