Based on current wholesale rates, theoretically you could get a new 5/1 ARM with a lower rate. However, this will depend on a number of factors, such as where you are located, points, etc.
You should pull out your loan documents that spell out the terms of your ARM. It is never as simple as "1% every year". There is going to be an "index", such as the 1-year LIBOR, upon which the new rate will be based. There will be a "margin", a percentage added to the index that will represent the new interest rate. There is are "limits", which indicate the maximum amount that your interest rate can change at 1) the first adjustment; 2) each subsequent adjustment after the first; and 3) the highest and lowest interest rate that can apply to your loan, regardless of market conditions.
Don't forget the closing costs. You could get a no-closing-cost loan, but this will come at the expense of a higher interest rate. You could pay points to get the rate lower, but if you are going to sell in a couple years, you might not recover this cost.
