Car Lease Ratings Guide

Car Lease Ratings Explained

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Car Lease Ratings Guide
LVR Car Lease Calculation

The Monthly Car Lease Ratings on this website are based on a simple formula. The car lease ratings number I use is called the LVR or Lease Value Ratio. This number simply tells us how much car we are getting for our money. Face it; do we really care what about all of these lease terms and jargon such as Depreciation, Residual Value, Capital Cost, MSRP? The bottom line about our Leasing is Cash-Flow and how much car we get for our monthly outlay. LVR (lease value ratio) is the average monthly payment divided by the MSRP (Manufacture Suggested Retail Price of the Car). Note, that the advertised monthly payment is different from the average monthly payment. The average monthly payment includes any additional down payments or costs we paid to negotiate the lease. Keep in mind, that car leases do not require a downpayment. The down payment, or cap. cost reduction is simply a way to reduce our monthly, fixed payments. In essence, though, we still have to make that payment whether it’s up front or not, so that has to be figured into our total costs, or considered part of our monthly payments, right? So, the monthly car lease ratings uses the LVR to determine best lease offers from top-to-bottom.

LVR Car Lease Ratings Example

Let’s say we lease a 2010 Honda Accord LX with the following figures:
Manufacturers Suggested Retail Price (MSRP): $22,565
Lease Term: 36 Months
Downpayment: $2,100
Monthly Payment: $199

In order to determine our Average Monthly Payment we take our $199 monthly payment x 36 Months and add that to the $2,100 we put down on the lease to come up with our Total Cost: $9,264

Our average monthly payment is simply our total cost divided by the months we are leasing the car.
Thus, our average monthly payment for the Honda Accord example is $257.33
What I really care about when I lease a car is how much my total cost is per month to drive it. Therefore, we have to include all of our payments, not just the advertised monthly payment. It is really costing us $257.33 per month to lease the car, rather than the advertised payment of $199.00. Local Car Advertisements always try to entice us with low monthly payments, but they usually put that down payment down near the very bottom, so it is not so noticeable.

The final number is the LVR (Lease Value Ratio). This is the average monthly payment divided by the MSRP The lower number, the better. The LVR indicates how much car we are getting for our cash outlay.

In the example of the Honda Accord, our LVR is 1.14% ($257.33 / $22,565)

As you will learn in our monthly top-20 car lease ratings, 1.14% is a decent, but not great LVR. We have seen car leases with LVRs as low as 1.03%.

Check MonthlyCarLease each and every month to see the top Car Leases based on these described, Car Lease Ratings.


Useful Car Leasing Websites


7 thoughts on “Car Lease Ratings Guide

    • You might be able to come close to that payment on a Hyundai Elantra which is a great car with great mpg. Negotiate with your dealer by starting lows $129 a month and nothing down. It might also help if you drive less than 10k miles. Good luck!

  1. The formula doesn’t reflect other important considerations such as contracted mileage, excess mileage costs, and disposition (lease-end) fees. As such, it’s value is limited.

    • Yes, and that’s true of any ratings formula, David. I explained this, here: How to Lease a Car
      It is important to consider mileage, disposition fees and excess costs. Also Lease term can make a difference. LVR is a rule of thumb upon which to help one find the starting point for engaging in negotiations with your dealer.
      You should always ask your dealer for a better deal – and part of that deal is getting 12,000 miles not 10,000; having them wave disposition fees and other excessive fees.

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  3. Mr. Delisa,
    Thank you for a very informative web site. I have a problem. Please enlighten me……. When using the basic lease calculator to acquire the LVR what is considered the MSRP price to be used? The window price is $26,900.00. The dealer quoted price is $23,800 (Dealer incentives). Which figure do I use? One LVR is rated as Poor and the other LVR is rated Good.

    Thank you for your time and attention.

    Charles Schiff
    Phone: 727 202-8844

    • Hi, Charles:

      You always use the higher of the two, the actual MSRP. This, of course, will give you a better LVR. The discounted price is one of the factors in determining the lower monthly payment. LVR tells you how much bang for your buck you are getting for your monthly payment. Hope this helps,

      Thanks for writing,


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