An interest only mortgage is where the repayments are set against the interest on the loan only, so only the interest is being paid. This means that by the end of the mortgage term, the capital originally borrowed is still outstanding. Borrowers are advised to make regular payments into an investment policy, such as an Endowment mortgage, an Individual Savings Account (ISA) mortgage or a pensions mortgage, to pay off the balance. This type of mortgage usually works out cheaper because only the interest on the loan is being paid. However, at the end of the mortgage term, if you do not have enough savings to pay off the balance, you risk losing your home. It is also worth noting that this type of mortgage is preferred if you intend to move home, as it is usually not dependent on staying in the one home, therefore it can work out cheaper in the long run.