Which of the following is a characteristic of VA loans compared to conventional loans?

The characteristic of VA loans that sets them apart from conventional loans is the absence of a down payment requirement. This feature is a significant benefit for eligible veterans, active-duty service members, and certain members of the National Guard and Reserves, as it allows them to purchase a home without the need to save for a down payment, which can be a considerable financial barrier for many homebuyers.

Unlike conventional loans that typically require a 5-20% down payment, VA loans are particularly designed to support veterans and military personnel in achieving homeownership. This makes home purchasing more accessible and affordable for those benefitting from the program. The VA backs a portion of the loan, which reduces the lender's risk and enables them to offer favorable loan terms, including the ability to finance up to 100% of the home's value.

The other options do not accurately describe the key features of VA loans when compared to conventional loans: while interest rates on VA loans tend to be competitive, they are generally not higher than those on conventional loans; loan processing times can vary and are not necessarily longer; and VA loans are not restricted to rural properties—they can be used to purchase homes in various locations, including urban and suburban areas.