Are ARM's stupid?

I have a buddy at Rock Financial and he hooked me up with a mortgage, actually two mortgages. I guess the idea is that since I am looking to put as little as possible down and the two loans will eliminate the need to pay PMI. I'm not really worried because I believe him but I am curious if this is a standard practice? I don't intend to live in the house for a real long time, maybe 5-7 years. The first ARM portion of my loan is for 7 years. Does this make sense to anyone?