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Figure out the best location for the exhaust fan. Try to place it so the duct run is as short and straight as possible. Every elbow added to the duct work diminishes the exhaust flow of the fan. Also, make sure the location is free of any obstructions and is big enough to support the fan and duct work. Consult or hire a licensed electrician to run all the necessary wiring and install the wall switch. Note: Be sure to research and choose the right exhaust fan for your conditions. Carefully read and follow the instructions that come with it.
Insert the fan housing in place, between two ceiling joists. Temporarily secure it, and measure the duct run to where it exits the house. Mark this as the exit location. Remove the fan housing and drill the exit hole for the duct work. Use the long 1/4" bit to drill a pilot hole all the way through the wall to where the duct work will exit the house. Now re-drill the pilot hole with the hole saw, depending on the size of the duct work.
Re-install the fan housing and permanently secure it in place. Connect the duct work to the housing exit port, and run it over to and through the hole you drilled. There should be at least 2" of duct outside, extending past the exterior siding. Insert and secure the fan motor into the fan housing. Make all the necessary electrical connections. Note: Refer to the fan instruction manual for more details on this step.
Connect the exterior termination cap to the duct work on the outside and secure it to the house. Test the fan to make sure it's working properly. Finish the drywall around the exhaust fan and paint it. Install the exhaust fan grill cover.