Ignoramous posted an excellent description. I agree with his postulate.
Since you're on a very tight budget, let me suggest an oil pressure check gage (kit) at the parts store, along with a Haynes repair manual. This is an easy test, it'll be clearly described in the Haynes manual and in the test gage instructions, and it'll save you money over going to a shop. It'll also get you started in doing your own maintenance, which will save you tons of cash.
If Ignoramous is right, and I'll bet he is, that'll mean the engine is just basically worn out. I personally would be reluctant to spend money rebuilding it for a Corolla that age. You can try some higher weight oil, like going from a 10W30 to perhaps a 20W40, it might help, might not. Some recommend against this due to concerns with the top end (valvetrain) lubrication, but on an engine this worn I don't see that as a major concern.