Pentagon Federal often has very good rates. This particular loan is strange because the APR is much lower than the start rate: 4.384 versus 5.625. Later on the page it says APR 5.377. I would want to understand the reasons for these discrepancies. The 5% lifetime cap on the interest rate increase is reasonable for an ARM.

My limited experience is that Penfed has awful customer service. For better service and good local rates, see http://www.plcu.com/rates_db/interest_rates.asp. In my opinion their 1/1 ARM is an especially good deal, if you’re willing to take some risk. The start rate is 4.375% for one year, then it can adjust by maximum 1% per year, and it also has a lifetime maximum change of 5%, i.e. maximum ever is 9.375%.