When you have two debts and one chunk, the instinct is to pick the loan with the biggest monthly payment. Wiping it out frees the most cash flow. That sounds like it should win. I ran the numbers to test it.

Here's the setup. Your line of credit charges 8%. You have a $1,000 monthly surplus, which is the money left after bills. You owe $10,000 on a car loan at 4% with a $450 payment. You also owe $10,000 on a student loan at 7% with a $116 payment. You send one chunk from the line of credit to the first target. Every month you put your surplus plus any freed payment toward burying the line of credit, and then you send the second chunk.

Car loan first: the $450 payment is freed, and everything is gone in 15 months. The total interest across the line of credit and both loans comes to about $961. Student loan first: only $116 is freed, yet everything is gone in 14 months, and total interest is about $709. The higher-rate loan won by about $250 and a month.

Why did the smaller payment win? The car loan was already paying itself off fast. At $450 a month on $10,000, it was going to be gone in about two years anyway. The student loan at $116 a month would have dragged on for a decade, adding interest the whole time. A chunk saves the most when it kills the debt that would have charged you the most over its remaining life.

That means payment size isn't the test. Ask which debt would cost you the most interest if you left it alone. The rate matters, and so does how many years the loan has left. A high-rate loan with a short life can cost less than a medium-rate loan with a long one.

I also tried a closer race. With the student loan at 4.5% instead of 7%, the long loan still came out ahead, about $709 against $787. A loan with years left keeps charging you, even at a low rate.

The model is a rough one. It uses constant balances, a fixed surplus, and rates I chose. Your own line of credit, your own surplus, and the rules of your loans will change the answer. Check for fees too. A prepayment penalty can cancel the savings, and the first chunk math shows how to run your own version.

Once the first chunk is gone, the next chunk is due when your line of credit balance drops below one month's pay.

List your debts with the balance, rate, payment, and months left on each, then circle the one with the most interest still ahead of it.