National Association of County Veterans Service Officers (NACVSO) Practice Test 2025 - Free Veterans Service Officer Practice Questions and Study Guide

The statement that VA loans can be used to refinance existing loans is accurate because the VA offers specific refinancing options, such as the VA Interest Rate Reduction Refinance Loan (IRRRL). This allows veterans to refinance an existing VA loan to obtain a lower interest rate or switch from an adjustable-rate mortgage to a fixed-rate mortgage. Additionally, refinancing can help veterans access equity in their homes or consolidate their debts under favorable terms.

In contrast, VA loans do not require private mortgage insurance, which is a significant difference compared to conventional loans where PMI is typically required when the down payment is less than 20%. While there are some loan limits that can vary based on the borrower's entitlement and the location of the property, VA loans have been expanded in recent years, allowing for loans over conventional limits in certain cases. Lastly, VA loans are not exclusive to first-time homebuyers; both first-time and repeat buyers can access VA loans if they meet the eligibility criteria.