The fee is calculated on the basis of the remaining outstanding principal balance of the loan prior to applying the current payment. (goodfinancialcents.com)
Having taken some finance classes while in school, I knew the high interest rates on my loans would cause interest to accrue rapidly each month on the remaining outstanding principal balance. (u-fi.com)
If there are multiple loans with the same interest rate, please apply the additional amount to the loan with the lowest outstanding principal balance. (consumerfinance.gov)