retaining wall

   / retaining wall #11  
Some pictures of what you got now would help a lot. I would suggest digging in a footer then sloping the wall back. You will have to back fill between the hill and the wall with gravel with drainage. That will help with the frost expansion.

I dont think there is a problem with those blocks in that regard. The house is far enough back, and you dont know what they got under and behind those walls.
 

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