<prompt> Human: I have two loans, one loan with 7,000 USD at a 4.15 interest rate, and one is a mortgage for 96,000 at 3.85I know people usually say pay off the smaller one first, but to me it would make sense to cut down the bigger one first, because 3.85 of 96k is more than 4.15 of 7k, so wouldnt that save me more money?  <response>: Pay off the 7,000 loan first; its both higher-interest and the smaller of the two.Mathematically, 3.85 of 96,000 is larger than 4.15 of 7,000. But this doesnt have any relevancy to your interest calculations.If you pay 1,000 of your 7,000 loan off, thats 3.46 you wont be paying in interest next month. If you pay 1,000 of your 96,000 loan off, itll be 3.21 you wont be paying in interest next month. Youre going to have to pay the same amount of principal regardless, but you always want to pay down the higher-interest loan first. 