Need guidance on how to invest lump sum

Hey all long time lurker here, using a throwaway account as IRL people i know follow my main.

Wife & I are both 40% tax rate payers living in London. We have both maxed out the ISA for the year, we each have enough in a saver to max out the PSA, and we both hold the max amount of 50k in Premium Bonds.

I will soon be receiving 85k ish from abroad through the sale of my parents property which is being gifted to me. I have no idea how to best invest or use this money as we have filled out our tax free wrappers.

We do have a house that we pay the mortgage on, at a rate of about %3.5. We have around 200k left on the mortgage and we would ideally be looking to move in the next 2 or so years as we need a bigger property (planning to have kids).

Is the most logical route here to just keep the money in a saver account and pay the tax on the income we get from it as we'll need it accessible to pay for stamp duty, or would it make more sense to overpay the mortgage now?