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What your cash flow isn't going to have an impact on, you might as well lock it into a lower interest rate.
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This is what isn't making sense. Most mortgage products (all open/vaiable rate mortgages) allow you to make up to 20% lump sum payments every year, or double up monthly payments, or some scheduled increased monthly payment plan to reach 20%. Why pay a higher rate on an loc principal and then transfer that principal to the fixed portion later. That makes no sense. Just do it all at the same time at a lower rate. 20% is enough to take care of most people's extra cash for sure.