Speed · Plain-English answer
Yes. Downloads pass through the VPN server, so your speed is capped by the slowest link in the chain: your line, the server and the route between them. With a nearby, lightly loaded server the difference is often small. Long transfers are affected more by server load than by encryption itself.
A web page needs a burst of data, while a download holds the connection at full stretch for minutes or hours, so every bottleneck in the path shows up. The VPN server's own bandwidth is shared among its users, and during busy hours a long transfer inherits that contention in a way quick browsing never notices.
Encryption overhead exists but is minor on modern hardware. The dominant variables are the distance to the server, how busy it is, and the quality of the route between the server and the download source.
Pick a server close to you for general downloads, or close to the source for a specific one, and avoid obviously popular locations at peak times. Compare a couple of servers with a sustained test rather than a ten second burst, since short tests hide congestion.
For peer to peer transfers, note that some providers restrict them to certain servers. ROOT allows P2P and BitTorrent on every server, so torrent traffic does not need a special location, and the same proximity logic applies.
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