I want to pay off half of my high interest student loan with a lump sum.
I have 2 options when applying the payment: to apply the amount to my balance or to advance the due date (i.e. to apply towards the due amounts for the next few months).
Does it matter which option I choose if I intend to continue making monthly payments anyway? I'm leaning towards the latter so that it gives me the flexibility to not make payments if I run into any problems.
My loan is with Discover, if that matters.
Edit: The exact text for both options read:
Apply Overpayment Toward Account Balance: Payments will generally be applied first to late fees, then to accrued interest due through the day before your payment is received and the remainder to the principal balance.
Apply Overpayment To Advance Payment Due Date: By selecting this option, you are choosing to apply your overpayment proportionally to your loans in repayment and advance your next month's payment. Interest will continue to accrue on your loan and you may pay more interest over the life of the loan.