Victims of Payday Lending: Sandra Harris

Keeping up: Sandra Harris' story

Sandra Harris
Wilmington, NC
Occupation: accounting technician
Six simultaneous loans during a six-month period
Estimated $8000 in fees for 6 payday loans

Sandra Harris was at the top of her game.

Once a student in the Head Start child development program for low-income families, Sandra had come to serve on the board that administers Head Start in New Hanover County. She was honored as 2003 Employee of the Year for her work at UNC-W, and Wilmington residents knew her as a radio personality on WMNX.

But all was not well for Sandra underneath the surface. Her husband had lost his job as an executive chef. The couple, who had always been a month ahead on their rent and bills, found themselves in a cash crunch.

Their car insurance was due, and Sandra simply could not pay the bill. So she called Payday Loans Direct. Getting a $200 loan was as easy as the commercial claimed. She paid the $50 fee for the loan, and paid her insurance bill on time.

On her next payday, Sandra was ready to pay off the small loan.

"You know, you can renew," the payday clerk told her, and the thought of her unpaid light bill flashed into her head. Sandra thought, "You're right. I do need it."

Sandra renewed twice more, and found she was then "qualified" to take out a larger loan, this time for $500. She soon took out a $600, for a $150 fee.

This money did not support a lavish lifestyle, Sandra said. "People think you're living above your means," she said. But she was paying bills, not buying clothes. Sandra was working diligently to manage her family's bills during a tough financial time. She thought the payday loans were helping her catch up.

After a round of rollovers, the first lender demanded full payment of the loan. Sandra could not pay it off, so she went to another payday lender, Urgent Money Service, and took out a loan to pay back the first lender. She kept getting in deeper. Within six months, Sandra was paying rollover fees on six different payday loans.

In June of 2003, Sandra and her husband were close to being evicted from the apartment they had lived in for six years. Sandra wrote, "Basically, we ended up having to use one loan to pay off another loan, and ended up paying $495 to $600 per month in fees, never paying the loans down." This went on for at least six months.

Sandra bounced checks. Her car was repossessed. She increased her tax exemptions so she'd have more money to pay her bills, and ended up owing thousands of dollars in back taxes. She finally broke, and spent a shift at the radio station wiping tears away between segments.

"It takes a lot for me to cry," she said. "I'm strong like my mother."

Sandra got help from a credit union, an understanding landlord, and her mother. She is still paying over $100 per month on one payday loan, and her wages have been garnished because of the taxes she owes. Sandra doesn't quite know how she is going to catch up.

"There's no cushion," said Sandra. She has come a long way and had terrific successes. But because she got caught in the debt trap, Sandra now feels she is financially always a step behind.