HUNTSVILLE, Alabama -- It's almost beyond comprehension that a man would put up both his cars and work trailer with all his equipment as collateral for a $93 loan.

But that's pretty much what Jerry Dobbs did when he needed to buy feed and seed for his Blount County farm.

To be clear, that didn't happen at a local bank this week. The loan transaction dates to May 6, 1939, and was with J.A. Brice and Son, a feed and seed store in Oneonta. The actual loan amount was $5.57 ($92.69 in today's dollars) worth of animal feed and corn and cotton seed.

His collateral for the purchase: two 11-year-old mules, a two-horse wagon, a 6-year-old cream cow and all his farming tools and harnesses. The standard contract also had pre-printed requirements that would take Dobbs' "entire crops of corn, cotton and other produce" should he not repay the loan.

"And people think times are hard now," said Carla Hill, Dobbs' granddaughter and team leader at Region's Bank, Airport Road Branch in Huntsville.

The document of the merchant loan now rests in a frame behind Hill's desk where she can quickly display it to customers complaining about security for bank loans.

"People nowadays want to get $10,000, $20,000 for a signature loan," she said. "So, I really do pull it out and show them."

Dobbs was a poor, family farmer who rented his plow fields, Hill said, but it amazes her to realize that his desperate transaction was just two generations ago.

"You would think that would be 150 years ago," she said.

Hill's comparison of her grandfather's situation to rural Alabama life in 1860 is dead on, according to UAHuntsville associate history professor, Dr. Stephen Waring.

He said the merchant loan document is a classic example of what was called "debt peonage" where everything a farmer owns and raises is pledged to the local merchant.

"It is slavery by another name," Waring said.

Waring described a list of physical and social factors that contributed to a system by which merchants like the Oneonta feed store could maintain an economic stranglehold on poor farmers. The two key factors were poor roads/transportation and no alternatives from local banks

Terrible transportation throughout the South gave local merchants a monopoly on providing goods and buying farm commodities, namely cotton, and the local sharecropper had no choice but to accept whatever prices his merchant offered, he said.

Also, banks didn't engage with poor, illiterate farmers, leaving merchants to provide capital the farmers needed to work their farms. Again, this made the farmer dependent on the merchant, Waring said.

"The power of the merchant to extract a profit was made even greater by keeping store prices secret, he said. "This allowed the merchant to charge more for a farmer who bought on credit rather than cash. So the loans had hidden charges."

Waring and Hill agreed, the merchant business practices from Reconstruction to the Depression could be compared to the payday loans or title loans today that often put people in a cycle of deepening debt. Farmers like Hill's grandfather sometimes faced interest rates as high as 100 percent.

"My poor grandfather. He just could not get ahead," Hill said. "Once you are in this, you can't get out of it."

The sharecropping way of life began to end during the Depression and after World War II.

President Roosevelt's Agricultural Adjustment Administration drove many small renters off the land, while the advent of the tractor and other mechanization made tenant farmers unnecessary, Waring said. In addition, better roads and transportation created more competition to provide and buy farm goods. And lastly, the Civil Rights movement gave blacks standing in law.

Hill said her grandfather, who died about 30 years ago, did eventually break the cycle of debt and was able to buy a home about 15 years before his death. Knowing what he overcame makes her even prouder of his accomplishment, she said, and she's just as impressed that today, separated by one generation from her grandfather, she has enjoyed a long career in the banking industry.

"It's amazing that national banks didn't do mortgages then," Hill said. "Mortgages today are our bread and butter. And it's just amazing to me that it was only 73 years ago."