I found parge coating falling away from my fieldstone foundation(1906). I used a hammer to tap on the remaining parge of the first section I am going to repair. Some of the coating sounds very solid while other parts sound hollow I removed the portions that sounded hollow. I have two questions. Should I remove the portions that sound solid? How deep should I remove the loose sand mortar? I think I could go all the way through the foundation and not find solid mortar. The foundation is about 18" thick I have gone 6" or more into the loose mortar in some places and am afraid to go much deeper without some advice.
I think that probably depends upon where you live, and what type of stone that fieldstone is. If it's dense nonporous fieldstone, you could remove most of the loose stuff near the surface and have a contractor shoot the foundation with gunite. If it's porous fieldstone, though, that'd be the worst thing in the world for you - gunite is essentially nonporous (which is why it's used for swimming pools), so instead of the (inexpensive) mortar being sacrificial the stones would become sacrificial - your foundation would crumble. Porous fieldstone calls for "soft mortar", which represents a lot more work for you now.
I don't think I'd dig any mortar out of the interior of the wall, either way - the stones are at this point stable, the mortar is primarily there to slow down breezes & rainwater. A deep surface reparging should be fine.
I'm not sure that damaged parts are mortar, or at least they aren't all mortar, because no one would make foundations out of mortar, and if someone would do that you would have major structural issues by now. My guess is that your foundation is made out of some sort of "soft" stone which is now disintegrating, or at least it's mechanical abilities are poor (since you can smash it with hammer).If you don’t have any structural issues I don't think you should deal with foundation at all, but keep your eye on possible wall cracks, floors not being horizontal etc. When it comes to fixing present damage I suggest that you use higher quality cement mortar (without lime) and apply it on surface. Depending on surface (you haven't explained in details, plus a picture would be great) you might have a gripping issue with mortar, it might fall of the surface but that can fixed with right preparation of the surface and applying primer coating.