Much of the exhaust system can be visually inspected with a moderate level of certainty. Unlike the engine where many moving and internal components are functioning, the majority of the exhaust system is readily visible under the car. Corrosion is the number one cause for exhaust system failure and holes in the exhaust pipe are a sure sign of this.
Typically a hole will occur where pieces of the pipe are welded or clamped together such as where the tailpipe meets the muffler itself. Holes in these areas will be apparent by blackening, which are carbon deposits, around the hole location.
Many vehicles require emissions testing before being licensed depending on where you live. In order to have an emissions inspection the car must first meet mechanical standards such as no holes in the exhaust pipe in order to get accurate readings from the electronic emissions testing equipment they will use in testing the car.
Exhaust repairs are a relatively minor repair by comparison to more major mechanical repairs such as engines and transmissions. The exhaust system is broken down into two sections which are from the exhaust manifold (where the exhaust pipe meets the engine) to the catalytic converter, and from the catalytic converter back towards where the tailpipe exits the car at the rear wheels.
Learn how to identify which exhaust repairs are cheap and which are expensive in the exhaust manifold and emissions sensors section.