If your loan hasn't been funded I don't think any early payoff penalties could be applied but ask your loan agent.
You didn't provide many details about your ARM. You might be surprised how little more you spend on interest after converting to a fixed loan. You have to decide your own tolerance to the risk carrying an ARM.
One advantage of low interest rate loans, if they are paid at a fully amortized rate, is that you will be building equity much quicker early on than with a higher interest rate loan even though your payments are lower. Please take a look at:
Keller Williams Realty