My Roommate is a Compulsive Liar. What Should I do?

I am a female living with a compulsive lying female. We are both undergraduate juniors in college. She seemed like a pretty cool girl at first, but after living w/her for 1 week, I began to see she is the biggest/worst liar I've ever met. She fabricates lies that are so ridiculous, it makes it uncomfortable living w/her. I feel sorry for her, but even when I call her out on her lies, she just makes up more lies. She told me she makes $5k at an internship and having an affair with the married boss. He will soon be leaving his wife to be with her. She told me she dated a Saudi prince once, he was an oil tycoon and spent a lot of money on her. Why do people make up stories like that? Does she need mental help or what?
My Roommate is a Compulsive Liar. What Should I do?
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