Figure 1. Three Canadian 50¢ Schooner Bluenose stamps (Scott 158). From top to bottom, they are in the grades of extremely fine, very fine, and fine-very fine.

Some collectors and dealers have trouble distinguishing between grade and condition. Both are crucial to a stamp's value and desirability, so understanding is important.

The distinction is really pretty simple.

Grade refers only to the stamp's centering, and for some used stamps, to the cancellation. Condition refers to factors other than grade that affect a stamp's value and desirability.

The Scott catalogs recognize three basic grades: fine-very fine; very fine; and extremely fine.

Three 1929 Canadian 50¢ Schooner Bluenose stamps (Scott 158) are shown in Figure 1. The stamp at top is in the grade of extremely fine; the middle stamp is very fine; and the stamp at bottom is fine-very fine.

Fine-very fine stamps will be somewhat off center on one side or slightly off center on two sides. Perforations will be well clear of the design, but noticeably off center. Imperforate stamps will have two full margins with the design not touched on any sides. The cancel on a fine-very fine stamp will not detract from the design.

Very fine stamps will be slightly off center on one or two sides, but the design will be well clear of the edge. Imperforate stamps will have four full margins. Used stamps have light or otherwise neat cancellations.

Extremely fine stamps are close to perfectly centered. Imperforate stamps will have even margins that are larger than full margins.

The Scott Stamp Values – U.S. Specialized by Grade section of the Scott Specialized Catalogue of United States Stamps and Covers breaks those three basic grades down further into superb, extremely fine-superb, extremely fine, very fine-extremely fine, very fine, fine-very fine, fine, and very good. Two 1866 United States 15¢ Abraham Lincoln stamps (Scott 77) are shown in Figure 2. The stamp at top is in the grade of superb. The stamp at bottom is in the grade of very good.

Figure 2. Two United States 15¢ Abraham Lincoln stamps (Scott 77). The stamp at top is in the grade of superb, while the stamp at bottom is in the grade of very good.

For many years, the standard grade used for Scott catalog values was fine-very fine. However, with the 1997 edition, that standard was changed to very fine. The value given in the catalog is the retail price you can expect to pay for an example in the grade of very fine. Stamps in inferior grades would sell for less. Stamps in higher grades would sell for more.

Condition covers a lot of territory, starting with whether or not a stamp has been used. A stamp that has been used for postage is in used condition. A stamp that has not been used for postage and is otherwise undamaged is in mint never-hinged condition if its original gum is undisturbed. An unused stamp that has had a hinge applied to its back is in unused hinged condition.

Classic stamps issued before 1900 with some or all of their original gum remaining are in unused original gum condition. Unused stamps that were issued with gum, but which have no gum remaining are in unused no gum condition. Stamps canceled in mass without being used for postage and sold at a discount from face value are in canceled to order condition. CTO stamps frequently have full gum.

Other factors that affect a stamp's value are also part of its condition. To begin with, stamps are considered either damaged or sound.

Types of damage include tears, scuffs, pin holes, short or missing perforation teeth, creases, thins (paper peeled from the back of a stamp), stains, bleaching, toning, adhesions, and written collector notations. Regumming, rebacking and reperforation are also types of damage or attempts to hide damage.

A stamp that is undamaged is in sound condition.

Faults are part of a stamp's condition. Faults are things that detract from the value of the stamp, but which are not the result of damage. Faults include natural straight edges, paper inclusions, natural creases, gum skips, and blind or ragged perforations. Pen cancellations are acceptable on some classic stamps, but are considered faults on modern stamps.

Aside from gum condition, factors of condition that can increase a stamp's value include jumbo margins, fresh color, attached selvage, and plate or die varieties.