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Freeing up that smaller loan first clears your credit score of that debit and clears it paid in full and on time. You free-up that amount of liability and also have a paid-off loan on your report of $35,400 (no small thing!) You now have that much more "room" if you absolutely need to buy a car or finance something else... or better yet... as a safety cushion for losing your job or getting your pay cut or anything of that sort, you now have the flexibility to reduce your payments down to "minimum" only for the main loan amount - that much sooner - to endure through a hardship.
I think it's good sense to pay off the smaller debt first - throw everything extra you can at it and beat it away rapidly.
Hardships WILL happen and priorities will change. Plan for it.