KANSAS CITY, MO.  --  It seems as easy as 1-2-3.

You go into a payday loan store with proof of employment, sign on the dotted line, and walk out with $500 in your hand.

It's easy, until you try to pay it off.

"If you dont have the money to pay it off in that two week period, the interest rates are extremely high, and youre continuing to pay that interest over and over and over again," said Jana Castonon, a credit counselor who also lobbies for legislation to cap payday loan interest rates in Kansas. "In a very short matter of time, youve paid more interest than what you've recieved in that loan."

"Theyre saying 'no, our loans are only 25-30 percent' but they are only doing it on a 14 day percentage basis," said Castonon, who said that the amount of interest you could end up paying is up to 450 percent.

Payday loan stores are reporting a steady increase in traffic as the economy worsens. QC Holdings, a payday loan company based in Overland Park, reported a six percent growth in revenue over the last quarter.

And credit counselors say their seeing a disturbing trend emerging, as some people are using payday loans to delay foreclosure and mortgage default.

"It always puts them in a worse situation," said Elizabeth Phillips with Catholic Charities. "You cant use debt to pay off debt."

"Its a vicious cycle. Ive seen and talked to people who have 12, 13 payday loans going at a time," said Phillips. "And you tell me how are they ever going to get out of that cycle?"

source: http://www.myfoxkc.com/myfox/pages/Business