Updating the PHP version of an existing site?
Is it possible to update the PHP version of an existing Drupal site that is installed on a local server on Ubuntu?


Yes, upgrading server software for existing applications is common practice both inside and outside of the PHP/Drupal worlds.

If your operating system supports a newer version of php than you currently have, and Drupal (plus the contrib modules you're using) supports the same version you're planning to upgrade to, then you should have no problems.


  Is it done by an internal Drupal module or an external tool?


Drupal can't upgrade the software on your server, that's something that gets done at the operating system level; consult the documentation for your OS for details on how to actually do it (Google "ubuntu upgrade php 7").  Make sure you back up and perform this in a test environment before doing anything on a production server, just in case.

PHP 7 has significant performance improvements, and Drupal 8 supports it, so the particular upgrade you're suggesting would be a good move.