I don't get this part...

Arms adjust after a few years(they are typically locked for 2 or 3 years) and then you have to re-fi to avoid the rate going skyhigh. If your home appreciates, refinancing is no problem, if it depreciates like a lot of homes are doing then you could be in a bind. Plus why waste part of your equity paying to re-fi your house, get a fixed rate, Arms are a scam.