I typically grade records using the following grading scale:

Mint (M) - Perfect, unplayed condition, sometimes brand new and sealed.

Near Mint (NM or M-) - Almost perfect condition. Likely unplayed, no imperfections during play. No obvious signs of wear; cover, poster, inserts, etc. have no creases, folds, seam splits, cut-out holes, or other noticeable flaws.

Very Good Plus (VG+) - Clear signs of play and that it has been taken good care of. Cosmetic flaws such as light scuffs or very light scratches that do not affect play. Barely noticeable ring wear, discoloring, or other cosmetic defects. Spindle marks may be present.  Picture sleeves and inner sleeves will have some slight wear, slightly turned-up corners, or a slight seam split. An LP cover may have slight signs of wear, and may be marred by a cut-out hole, indentation, or cut corner. 

Very Good (VG) - Slightly more flawed than VG+ records. Noticeable surface noise, but not to the point of overpowering the audio. Noticeable groove wear, light scratches that can be felt with a fingernail, may affect play. Labels and LP covers may contain writing, tape, or stickers. 

Good (G), Good Plus (G+) - Plays without skipping, but contains significant surface noise, scratches, and visible groove wear. Covers and sleeves contain seam splits, usually on the bottom or spine. Tape, writing, ring wear, and other flaws are also noticeable.