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We have equity in our home and are considering a refinance to take out some of the equity for home improvement/repairs and to buy a vehicle end of lease. Credit scores are not great, 500-550ish. We have the option to either A) Do a 50-year fixed mortgage or B) Do a 2-year ARM and then refinance again in two years when our credit scores have improved. I’m not excited about paying closing costs now and then again in 2 years. We want to have the equity cash but also want to have as low a payment as we can get to minimize living expenses.

Would it be wiser to do the 50-year fixed or a 2-year ARM and then refi after 2 years for a fixed rate? Paying closing costs twice in two years seems like a lot of money to me.
Additional information: We are currently in a 30-year fixed mortgage at 6% but do not qualify for that rate on a refi due to credit changes.
The purpose of our considering the refinance is to reduce our monthly living expenses by eliminating a car payment and to get money for home repair/maintenance. We have no debt but want to lower our living expenses. Financing our end of lease vehicle is not going to get rid of the car payment, only create a new one.