"I am looking for a 7/1 ARM. Most sites put a cap of $437k or so ."
ARM pricing for loans > $417K is pretty ugly right now, 30Y may be your best move. For that matter, apart from the 5/1 ARM, conforming ARM prices are ugly too.
"But ING Direct seems to offer great rates and up to $500k. What am I missing, or is their offer really one of the best?"
There are three primary conduits that you can use for your financing (retail, banker, broker), which are described here:
In this crazy market, I would suggest a Mortgage Broker or Banker with multiple funding sources.
If you are the type of person who likes to be well-informed before making a financial decision you should enjoy reviewing the two following links as well:
If you are going to be comparing the quotes of different lenders this should be done by asking for a Good Faith Estimate (GFE) from each lender, for the same product, on the same day, at the same time! As you will read, rates are based on the news of the world and can change very quickly.
Interested in "REO Shadow Inventory"? Check out my detailed blog post on the subject here:
"Coming to a neighborhood near you: REO Shadow Inventory"