The heat exchanger is where everything in a tankless water heater actually happens. Combustion gas on one side, potable water on the other, separated by a copper or stainless wall thin enough to transfer a burner's full output into water moving through in seconds. That thinness is what makes the design efficient, and it is also why the exchanger is the component least tolerant of anything that concentrates heat in one spot.
In Frisco, scale is the dominant failure path. At 8-11 grains per gallon, calcium carbonate precipitates onto the exchanger wall wherever the water is hottest. The deposit insulates, so the metal underneath it runs hotter than the design ever intended while the water flowing past carries away less heat than it should. Over years, that localized overheating anneals and thins the wall, and eventually it cracks or pinholes. This is why the units we condemn early in Collin and Denton County are almost always the ones that were never descaled.
Freeze damage is the other mechanism, and it works fast rather than slowly. Tankless units include freeze protection, but on most models that protection is electric and stops working the moment the unit loses power. During the extended hard freezes North Texas sees periodically, an outage removes the protection, water in the narrow exchanger passages freezes, and the expansion splits the tube. Units mounted outdoors, in unconditioned attics, or in detached garages are the ones that take this damage.
Once an exchanger is compromised, it is not patchable in any way that should be trusted. The realistic question is exchanger replacement versus unit replacement, and the answer is driven by warranty. Manufacturers commonly cover the residential heat exchanger for 10-15 years, often conditioned on the unit being registered and maintained. Inside coverage, you frequently pay labor only, which makes repair the clear winner. Outside it, an exchanger and the labor to install it lands close enough to a full new unit that replacing the whole thing buys you a fresh warranty on every component instead of just one.