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Remove the existing moldy insulation. Treat the moldy area with a fungicidal solution. Mix and prepare the solution according to the manufacturer's instructions.
Once the fungicide dries, install the new insulation. Encapsulated insulation is more comfortable to use because it's covered on all four sides, preventing any fiberglass from getting on you. Use a utility knife to cut the insulation to size when necessary. Make sure that the side that labeled "vapor retarder" faces the living space.
The insulation has flanges on the sides for stapling. Secure the insulation to the subfloor every 6" to 8" with a staple gun.
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