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If you are talking of an underneath garage, which I consider to be a built in garage, then building codes require them for safety using special fire resistant drywall.
If you are talking of an attached garage, then the same requirements would apply on the side next to the home. In this case, the drywall should extend to the roof, or have the ceiling covered with similar fire resistant drywall.
Under the requirments of the safety requirements of FHA, it should be enclosed. They have wiped out so many of their previous requirements that it is hard to tell, but the health and safety stuff is still there.
It gets sticky sometimes, doesn't it? I see many older homes with the water heater exposed and at floor level in either the kitchen or utility room. Yowsa! Real close to that dryer and stove! This particular one gives me far more concern than fire code drywall in the garage, but maybe that's just me.
I'd check with the building inspector for their policy on grandfathering and current compliance, and then make the comment accordingly.
'The garage does not currently have fire code drywall installed on the ceiling, however verification with the County Building Inspector reveals the method was in compliance with applicable code or lack thereof at the time of installation.'
Report what you see and let the lender decide.
The other question is, does the market have an issue?