I'm with AT&T. My line's 6s is under contract (2yr, went into the store to get it), my wife's 6 is out of contract. I used the Apple Store from my phone, and used 'Replace this line' and 'Paid in full'. I received a warning that my phone was under contract and went ahead anyway, paying in full. ($869/128GB Jet Black 7+).
The intention is to unlock the 6 to prepare for sale, put the 6S on her number (SIM swap only), and activate the unlocked 7 on my number.
I feel like I did the right thing but if I was paying in full, unlocked, why did it even ask me questions about my status? It seemed weird because I felt I should just be able to hit buy for AT&T and be done.
EDIT: It seems on the website I can pay in full without telling them my number. Seems I had to on the store app (unless I missed something).