But today, the single mom owes $4,450 spread across four payday loan companies and her cycle of debt is not likely to stop anytime soon. That's because each company has specific requirements for payment of the loan principal that make payoff prohibitive. In one case, for example, Oliver must pay in $50 increments.
That's a tall order for the special education teacher who's living paycheck to paycheck. Instead, Oliver routinely pays $800 a month on interest alone and continually rolls over the loans.
"I thought it was going to be a temporary" bandage, says Oliver of Providence Village, Texas, about the payday loans. But "I don't see how it's ever going to get sorted out."
Oliver's experience is far from unique, says Irene Leech, who has long watched the payday loan industry as an associate professor of consumer studies at Virginia Tech and a past president of the Consumer Federation of America.
"They tend to be a very expensive way to borrow money and they tend to suck you into a cycle of debt," Leech says of payday loans. "People often just end up with more problems instead of solving the problem that they had."