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When I took off the home button, a small black about 1/8 inch square rubber piece fell out. While gently peeling off the heated cable. Can anyone tell me where this is supposed to go when I put the home button back on.
It goes over one of the two screw hole right under the home button.
Not too sure what rubber piece you are taking about with the home button. There is not rubber peices on the home button of the 7 or 7 Plus. Can you take a picture of the piece and where it came off and I can tell you what is it and where it goes? Can you also confirm that you have an iPhone 7 that you are working with?
Here is the picture
The black rubber piece may have come out of another section of the phone. It was probably dislodged earlier and was just waiting to fall out. I just had one fall out of my i7.