Property condition report vs. pre-loss documentation
Short answer
A property condition report is the record a lender's consultant writes after one site visit for a loan or purchase. It looks for material deficiencies and estimates repair and reserve costs, and its observations and photos are representative, not complete. ASTM E2018 says to rely on it only for the point in time of the visit.1,2 Pre-loss documentation has a different job: it records the roof itself, in detail and with dates, so the roof can be compared before and after a storm. It keeps what engineers use to date damage, such as spatter marks, dents and when the roof and rooftop equipment were installed.
Cloudbreak team · Updated October 28, 2026 · 5 min read · 8 sources
What a property condition report is
ASTM E2018 (2024 edition) sets out the property condition assessment (PCA) of commercial real estate: a walk-through survey plus document review and interviews. Its written product, the property condition report (PCR), lists material physical deficiencies with opinions of costs to fix them. ASTM calls the process not technically exhaustive; it reduces uncertainty but does not remove it.1
Multifamily lenders use it to size repairs and reserves. Fannie Mae's PCA covers the property's condition at a specific point in time and the capital spending expected over the loan term plus two years. Freddie Mac requires a PCR, also called an engineering report, before it issues a loan commitment, describing major components and their condition, deferred maintenance, repair costs and replacement reserves.2,3
Who prepares it and when
- Freddie Mac: the lender retains and directs the consultant. The borrower may pay for the work but may not direct it.3
- Fannie Mae: the consultant is an independent third party with no financial interest in the property, and a professional engineer, a licensed architect or a person with construction experience and certifications reviews and certifies the report.2
- Timing: Freddie Mac wants the report dated within six months before the underwriting package is delivered, and the site inspection within 30 days before the report date. Fannie Mae's report states the site visit date and the weather that day.2,3
What it records about the roof, and what it leaves out
The consultant notes roof type, access, slope, coverings, color and flashing, looks for damage, leaks or ponding, and reports roof age and the remaining warranty term (Fannie Mae). Freddie Mac's list adds parapets, scuppers, drains, gutters, coping and skylights, and a roof age given by management should be backed by the consultant's own observations or other information.2,3,4
The visit is visual and non-invasive. Fannie Mae's field observer does no diagnostic testing unless the instructions or the lender call for it.2
Photos are a sample. Fannie Mae requires photos representative of the property and of each item needing repair or replacement, plus major building systems, equipment and nameplates. Freddie Mac leaves the number of photos to the consultant, each with a narrative.2,3
Observations are a sample too. Where buildings are similar in approximate age, use, basic design, materials and systems, ASTM lets the observer skip some and extrapolate findings to similar areas.1
Small items are left out. Freddie Mac does not expect the report to list routine repairs and maintenance, which include minor items costing $3,000 or less each, as long as they appear to have been maintained regularly.3
Hail is not asked about. Fannie Mae's catastrophic event list covers earthquake, volcanic activity, flood, hurricane, tornado, wind, sinkhole, landslide and wildfire, but not hail.2
Limits on reusing a report
- Rely on a PCR only for the point in time of its observations and research.1
- A PCA is typically completed for the contracting parties, and use or reliance by others may violate those parties' rights.1
- A prior PCR is an aid to verify, not a baseline. Two PCRs can differ without either being deficient: better weather or site conditions, or equipment that was not shut down, can change what an observer sees.1
What a dated pre-loss condition record holds
Engineers who date hail damage trust evidence collected at the site most. Spatter marks fade at rates that vary by surface and exposure, so on a surface that takes both marks, a dent with a matching spatter mark points to recent hail and a dent without one points to an earlier storm. Roofs and equipment of different ages help too: in one case, older rooftop units had deformed coil fins throughout and a newer unit did not; in another, historical aerial imagery bounded when each building was built.5
The width of dents in aluminum HVAC fins is the best gauge of hailstone size at a site, and a photo or video of a roof, damaged or not, may prove useful later.6
A record that supports that work holds:
- Inspections: FM Global recommends inspecting roofs, flashing, drains and rooftop equipment at least twice a year and before and after severe storms, with well-organized written or computer records and pictures of problem areas.7
- Roof detail: the IBHS and RICOWI survey covers roofing materials, counts of penetrations and drains, roof-mounted equipment, weathered condition, and the size and direction of spatter marks and dents.8
- Background: roof covering age, maintenance history, warranty information and how the roof did in earlier weather events, which the IBHS and RICOWI protocol asks owners for before a survey.8
- Dates: when the roof and rooftop equipment were installed, which helps bound when dents formed.5
- Drone photos: drone images, typically 1080p or 4K, can show roof detail comparable to standing on the roof.6
| Item | Lender property condition report | Dated roof condition record |
|---|---|---|
| Purpose | Find material deficiencies; estimate repair and reserve costs | Find the cause and extent of aging, wear or storm damage; document conditions at that point in time; compare with prior data when available (IBHS and RICOWI) |
| Who does it | Consultant retained and directed by the lender (Freddie Mac) | A qualified person, under a roof inspection program (FM Global) |
| How often | At underwriting; site inspection within 30 days before the report (Freddie Mac) | At least twice a year and before and after severe storms (FM Global) |
| Roof coverage | Type, coverings, flashing, evidence of damage, leaks, ponding, age, warranty term | Materials, penetrations, drains, equipment, weathering, spatter marks and dents |
| Photos | Representative, plus items needing repair and major equipment | Pictures of problem areas (FM Global); photos with corresponding notes (IBHS and RICOWI) |
| Minor conditions | Routine items of $3,000 or less not expected (Freddie Mac) | Dents and spatter marks recorded by size and direction |
How Cloudbreak helps
Pre-loss documentation
A dated record of every roof section, elevation and rooftop unit, in photos, drone video and notes, with original files and timestamps intact.
For portfolios
One agreement covers every property, inspections are scheduled wherever your buildings are, and there's no upfront cost.
Storm monitoring
Our proprietary predictive storm engine, built with AI and backed by meteorologists, watches every building against its own roof-based thresholds; our on-call team picks up urgent matches within 15 minutes, day or night.
Questions
- Can the property condition report from our loan be used to prove pre-loss condition in an insurance claim?
- It can help, but it was not made for that. It records what one consultant saw on one visit, and ASTM E2018 says to rely on it only for that point in time. Its observations and photos are representative, and it is typically completed for the parties to the loan. A pre-loss roof record documents the roof in detail and is compared with later conditions.1,2
- What is the difference between a property condition assessment and a pre-loss inspection?
- A PCA finds material deficiencies and estimates repair and reserve costs for a loan or purchase. A pre-loss roof survey, such as one under the IBHS and RICOWI protocol, looks for the cause and extent of aging, wear or storm damage: it documents the roof at that point in time, including the size and direction of spatter marks and dents, and compares it with prior data when available.1,3,8
- Does a property condition assessment include the roof?
- Yes. Fannie Mae and Freddie Mac both require roof observations, including roof age and flashing, and Fannie Mae also asks about damage, leaks or ponding. The visit is visual and non-invasive, with no diagnostic testing unless the instructions or the lender call for it.2,3
Cloudbreak
The owner-side property protection team for commercial and multifamily owners in storm country: a dated record of every building, nightly storm checks and a review of your policy, before a loss.
Sources
Written by the Cloudbreak team. Numbers, dates and rules cite the published sources below.
- 1. ASTM International: E2018-24 Standard Guide for Property Condition Assessments: Baseline Property Condition Assessment Process
- 2. Fannie Mae: Form 4099: Instructions for Performing a Multifamily Property Condition Assessment (July 2026)
- 3. Freddie Mac: Multifamily Seller/Servicer Guide, Chapter 62: Property Condition Report Requirements
- 4. Freddie Mac Multifamily: Property Condition and Environmental Report Best Practices (May 2025)
- 5. ASCE Forensic Engineering 9th Congress: Dating Hail: Investigation and Determination of the Date of Occurrence of Hail Impact Damage (Verhulst, Bosley and Donaldson, Nelson Forensics, November 2022)
- 6. IIBEC Interface: How Technology is Revolutionizing Complex Roofing Assessments (June 11, 2020)
- 7. FM Global: Property Loss Prevention Data Sheet 1-28: Wind Design (October 2015 edition, revised April 2026)
- 8. Insurance Institute for Business and Home Safety (IBHS): RICOWI Roof Guide: Survey Practices