With an interest only loan, just interest gets paid on the loan during the interest only period. That mean the monthly payments are less than a standard loan. After the interest only period ends, typically between one and five years later, you have to make repayments on principal and interest for the rest of the loan's term.
For example, if you take interest only home loan of $500,000 for 3 years on a 30-year loan term then for the first 3 years your repayments will be interest only. for the remaining period of 27 years your repayment will be Principal and Interest.