After a short recap of the previous video, the scene cuts to Edd and Tom in the kitchen having breakfast, where Tom tells Edd about noises that were coming from the attic the previous night. Edd and Tom decide to investigate, only, to their surprise, to find out that Matt has apparently decided to tidy up his room, become less narcissistic, and is now using more sophisticated words. Edd jokes about Matt's sudden change in behaviour, and Matt, who is possessed by a ghost, throws the duo out of the house. The ghost possessing Matt intends to take over the world, but Matt argues with the ghost about destroying monuments. The ghost leaves Matt's body after Matt insults him for throwing away his expired milk, and it possesses the house, not allowing the three to enter.
The group decided to ask help from Eduardo, only for him to mock them. As the trio explain their situation to Eduardo, the ghost pushes Eduardo's house extension over, revealing that Eduardo cheated and used cardboard to make the extension. He reluctantly decides to help the trio, saying that he'll go to a psychic.
At the Insta-Roof store, Son Rwanson, the manager, tells the trio that they need spirit insurance, which Edd didn't get beforehand, to protect their roof from supernatural forces. Rwanson adds that the Insta-Roof factory is built between a cemetery and a vet, making the roofs produced prone to being possessed or filled with rabid ferrets. The group leaves the building while Tom gets mauled by a rabid ferret. The two trios meet together, and Eduardo says that the psychic said that haunted houses (and Edd and his friends) are stupid, but Jon thought that the psychic called him, Eduardo and Mark stupid, causing Eduardo to threaten to punch Jon in the face. Matt then suggests that the three go into the house and make a mess, something the ghost doesn't like.
Eduardo, Jon, and Mark set up deckchairs and watch the trio charge in and confront the ghost. The trio make a mess in their house, invoking the ghost and causing it to attack them. The ghost easily gains the upper hand and is about to kill Edd when Tom calls out for him. The ghost, upon hearing Edd's name, immediately stops attacking and realizes that he's supposed to go after Eduardo instead. The ghost possesses Eduardo's house, and Edd and his friends decide to watch. Eduardo vows to get his revenge before the ghost punches him off-screen.
- Edd: So, any luck with the psychic?
Eduardo: She said that haunted houses were stupid and that you guys are stupid.
Jon: I thought she said WE were stupid.
Eduardo: I'M GONNA PUNCH YOU IN THE FACE.
- Son Rwanson: What! You're crazy! How can you not like ice cream?! Ice cream is delicious!
Matt: Too cold! It hurts my teeth!
- Tom: Aaaand the last horse crosses the finishing line.
Edd: Can we still get in?
Tom: I don't see why not, we just open the door, and, OH, now I'm going backwards!
- Tom and Edd: ARE WE READY?!
Edd, Matt and Tom: YEEEAAAH!
- Matt: Hey, chums! How is everyone this fine morning?
Edd: Wow Matt, this place is actually clean.
Matt: Indeed. I thought I might as well tidy up a tad.
Tom: I'm surprised you found the time in your busy self-worship schedule.
Matt: Yes, well, I thought it was time to unclutter my life and become less vain and narcissistic.
Edd: I'm impressed. Being tidy, not caring about your looks...
Tom: Using words with more than two syllables.
Edd: (jokingly) Ha-ha! Yeah. Who are you and what have you done with the real Matt? (Edd continues laughing)
- Matt: (After he, Edd, and Tom entered the house) OH DEAR GOD!! It's exactly the same.
- One of the posters at Insta-Roof say that a fiddler is wanted, having last being seen on a roof. This references the movie Fiddler on the Roof.
- Behind Tom in the Insta-roof building, there is an asdf poster that says, "A happy worker is a vicious psycho."
- At the beginning of the video, Tom yells "WHY DID YOU LEAVE?!?!? WHY?!?!" at someone through the red phone he was holding. When the intro was shown in one of Edd's livestreams, he wasn't holding the red phone. Also, this was not in Hammer and Fail Part 1.
- Tomee Bear makes a cameo appearance on the sofa and Edward Gold from picture from "Saloonatics" when Matt says "OH DEAR GOD IT'S exactly the same."
- Paul makes an appearance in a picture and in the background.
- Matt's "Matt doll" can be seen, referencing The Matt Doll.
- At the beginning of the episode, Edd says "So, sleep well last night?", to which Tom replies "No." This is a reference to the first Hammer and Fail where Tom asks the same thing.
- There is a no-ghosts sign on the door of possessed Matt's bedroom, a possible reference to Ghost-Busters.
- On Matt's calendar on the 10th of Septembuary, it says "moi" instead of "me".
- In Matt's bin, there is a magazine that says "16 Tips on How Ugly You Are".
- When Edd and Tom enter Matt's clean room in the beginning, there is a skeleton head that looks very similar to Zanta's on a drawer on the right side.
- Sunglasses in Matt's room look like they are from his channel, "wallycube".
- At Insta-Roof, a poster outside says "THE ROOF THE ROOF THE ROOF IS ON FIRE". This is an actual song, "The Roof is on Fire" by Bloodhound Gang.
- In one of Edd Gould's LiveStreams for Hammer and Fail Pt 2 Tom said "Holy Snowflake On Jabba the Hutt!" but it was never put in the final version.
- The ghosts glasses say "spook-tcles".
- In the subtitles, when Jon is speaking, once it says "Tom" instead of "Jon".
- There's a picture of Hellucard in Insta-Roof next to Matt that says "Do NOT Accept Cheques from this man".
- When Matt reads the Insta-Roof ad the ad under it says "HAVE YOU SEEN MY SAUSAGE?!"
- In the intro, Tom says, "I did not want to do this." This references Part 1, where Edd sings, "This is the opening tune" during the intro.
- When they were going to charge in their house, Edd's armour has a text saying "RAAAAAR"
- Before Edd, Tom and Matt charge into their house, Mark and Eduardo switch voices.
- When Matt says "I thought I might as well, tidy up a tad?", the background is blurred. However, on YouTube, it is not.
- Like in Part 1, there is a Mr. Potato Head on one of the shelves in the roof.
- When Edd says, "Damn it, past Edd!", it's a reference to WTFuture.
- A picture of Paul and Cancer can be seen on the wall behind Edd and Tom as they come up the stairs in the beginning of Part 2.
- One of the shelves contains a pyramid with an eye on it, a possible reference to the Illuminati, a barvarian organization that existed in the 18th century, which some conspiracy theorists claim to have survived its so-claimed "death" and is right now in charge of the United States government.
- The worker at Insta-Roof's name is Son Rwanson, which a reference to the Parks & Recreation character Ron Swanson.
- The "I'M GOING TO PUNCH YOU IN THE FACE!" sentence was used in Thomas Ridgewell's asdfmovie5 video, the only difference being that Eduardo does it in a deep and slow voice.
- In early 2012, Edd Gould asked the YouTuber Yaplap if he could dub an Eddsworld episode with his "hilarious" screaming voice. Hammer & Fail Part 2 was that episode. The project was supposedly a fraction complete before Edd's death and was released on YouTube a year after Edd passed away.
- On November 24th 2011, Yaplap uploaded a YouTube video entitled "eddsworld.flv". The video shows the Eddsworld YouTube channel 4 months after Hammer & Fail Part 2 was released. Yaplap scrolls down to Edd's favourites to show that Edd favourited 2 of his videos, after that; Yaplap screams "Eddsworld!" and drops the camera. After Edd died, Yaplap added this text as an annotation on the video "March 27th, 2012; I was about to delete this video, as my audience believes it shouts "Eddsworld" as a curse towards Edd for favouriting my videos, but this is not an angry shout, it's a scream of happiness. Rest in peace Edd. We shall treasure the world you've created for us."
Click here to view the gallery.