if you plan on moving get a 5/1 ARM.
If you plan on staying get a 30 year fixed.
Its generally OK to start with an ARM because you can borrow more (i.e. get more) cuz of the lower rate. You can buy more house than you can under a fixed. Then refinance to a fixed rate down the road when you can afford it.
The down is tricky.. put as much as is necessary to qualify and then keep the rest for repairs especially if you are buying a "used" (abused) house.
Don't wait... its a good investment.
Well said Mr. C