Strutmasters sells an aftermarket trunk latch that will install in place of the old pull down motor/latch assembly. it's cheap and inexpensive to do. I just ordered one for my 1992 Lincoln Town Car.
im sorry to say this but it sounds like the pull down moter went out. i have had a few people "slam" my trunk on my mark 7 and cause the same damage. "it closes & locks but dont sit all the way down." if that is the situation that you have, it's the part on the body of the car. it has a plug ( elect. ) they were made of plastic so get a "new" part. it is also best not to use a junkyard part, simply because you cant tell if it has been "slam" damadged! with a little patiance its not too hard to replace. it took me a few hrs to change mine out.
This is not an answer so much as a question: Can the latch be replaced with a non-moveable, fixed one from say a 92 Marquis or Crown Victoria?
I simply removed the latch and motor assembly from the trunk, took the latch and motor assembly apart, set the worm screw so the latch was in the seated position, put the motor and latch assembly back together, reinstalled the motor and latch assembly in the trunk leaving the motor unplugged, and then isolated the electrical connection with a small plastic bag and tape and tucked it in under the carpet.