Here is an overhang (seen from the basement of a home in Livingston, New Jersey) with no insulation, and no way to stop air infiltration. The spider’s web is a great indicator of air entering that overhang, as spiders typically like to build webs where there is good air movement (it helps them catch dinner). When air enters that overhang, the room above gets cold in the winter, or hot and muggy in the summer.
This overhang can be air sealed and insulated with dense packed cellulose or rigid foam board, or sprayed with closed cell spray foam. The end result should be airtight and insulated, and will make the room above much more comfortable for this home. It will also helps reduce the HVAC equipment’s load, which in turn saves money on energy bills!