Q: My wife and I want to buy a small cabin to use as a vacation home. Would we be able to write off all of the mortgage-interest payments on the cabin, just as we do the interest payments on the mortgage for our full-time home?

A: Yes, if you’re like most homeowners, you’ll be able to write off all the mortgage-interest payments on both your current mortgage and the new loan for the cabin.

The Internal Revenue Service allows most taxpayers to deduct interest on a combined $1.1 million of mortgage debt used for a primary residence and second home. In other words, as long as the two loans together don’t exceed $1.1 million, you probably can write off all of your interest payments for both properties.

Most second-home buyers fit well under the $1.1 million cap. But you should consult with an accountant before buying the second home anyway because the purchase probably will make you eligible for several other tax deductions, too – especially if you rent the property to tenants on the days that you and your wife don’t use it yourselves.

Q: I am 36 years old. You recently wrote that many workers can withdraw up to $10,000 from their individual retirement accounts and avoid the usual 10 percent “early withdrawal” penalty if the money is used to purchase their first home. I don’t have an IRA, but I have a company-sponsored 401(k) retirement plan. Do the same rules that apply to IRAs also apply to 401(k) withdrawals?

A: No, generally not. Although the IRS allows first-time buyers to make up to $10,000 in penalty-free withdrawals from their IRAs to make a down-payment on a home, it doesn’t provide the same tax break to people who tap their 401(k) retirement accounts.

As a general rule, you cannot make any penalty-free withdrawals from a 401(k) company plan unless you have reached the age of 59 1/2 or leave the job and simply transfer all of the account’s assets into a new retirement program.

But the good news is that the company may let you borrow against the equity in your 401(k).

Federal law permits employers to allow their workers to borrow as much as 50 percent of the value of their individual plan, up to a limit of $50,000.

Some employers allow such borrowing, but others do not. You need to ask the administrator of your company’s retirement plan, or someone in the human resources department, if you’re eligible for such a loan.

Although 401(k) loans typically carry very low interest rates – sometimes as low as 1 percent or 2 percent – interest payments on the loans usually are not tax-deductible. That’s because the IRS won’t let you put money into a tax-saving retirement plan and then give you a double tax bonus by giving you additional write-offs for borrowing against it.

Think carefully before tapping your 401(k) to buy a house. If you leave the company before the money is repaid, the entire balance of the loan could become due and payable in a lump sum. And if you’re unable to pay all the money back, you’d have to pay taxes on the unpaid portion of the debt and could get hit with a 10 percent early-withdrawal penalty from the IRS.

Q: We recently applied to refinance the mortgage on our house. Instead of giving us a FICO credit score like we have received in the past, the lender used something called a “VantageScore” instead. What is that?

A: A Northern California-based company called Fair Isaac revolutionized the credit-reporting industry several years ago when it developed the “FICO score,” which many lenders still use today when setting the interest rate a consumer will be charged on everything from mortgages to credit cards and auto loans.

The alternative VantageScore was introduced about a year ago by the nation’s three largest credit bureaus. Unlike FICO scores, the new system assigns a letter grade to each applicant’s rating – an “A” for borrowers who are in the top 901-to-990 bracket, a “B” for those in the 801-to-900 range, and so on down to those whose spotty credit histories rate an “F.”

The higher your VantageScore, the lower your loan rate should be.