By Andrea Hopkins and Kevin Krolicki Thu Mar 15, 6:46 AM ET DETROIT (Reuters) - Job losses in the U.S. industrial heartland have left states like Michigan and Ohio more vulnerable to mortgage defaults, as home finance costs rise amid often moribund real-estate markets. ADVERTISEMENT On a combined basis, Michigan and Ohio accounted for an out-sized 15 percent of foreclosures across the United States in January, the most recent month for which data is available from tracking service RealtyTrac. Some 546,000 jobs have been lost in the two states since 2000, according to U.S. government figures, as shutdowns and layoffs at auto plants rippled through the economy. More hardship is expected as announced job cuts take effect and unionized auto workers begin to leave the area or risk running through recent severance packages in the absence of new jobs, analysts said. In addition, many homeowners who put their houses on the market months ago and refinanced or bought houses elsewhere with adjustable-rate mortgages are now trapped between a soft real-estate market and their own escalating monthly payments. "A lot of people had visions of selling their homes, but that's not happening," said Hunt Gersin, president of Troy, Michigan-based mortgage broker Interactive Financial Corp. "Personally, I know dozens of people with houses for sale and no offers. There's not a bottom in sight." ECONOMIC DISTRESS Richard DeKaser, chief economist at National City Corp. in Cleveland, said there was no reason to believe Ohio and Michigan have more subprime mortgages, high-interest loans extended to people with poor credit scores, than other states. "The Midwest has endured more of its share of economic distress and home prices here haven't been robust, which by extension makes those subprime mortgages ... more vulnerable than subprime mortgages more generally," DeKaser said. "But it doesn't necessarily follow from that there is a high concentration of these loans in those markets," he said. DeKaser and other economists said there was no question economic distress in the industrial Midwest has made it more difficult for many borrowers. "Michigan has been losing jobs for six years now and the distress that comes with job loss alone ... is resulting in greater mortgages difficulties," said DeKaser, adding the exodus of residents to seek jobs elsewhere has compounded the problem of falling house prices. "So you've got this vicious cycle of falling property values and falling employment levels, falling population, and it is making for a very painful mix," he said. Ohio, DeKaser said, was not as clear-cut, with northern and more industrial portions of the state around Cleveland and Youngstown suffering more than Columbus and Cincinnati to the south. Michigan was the only state to see home prices fall in 2006. The national average increased almost 5.9 percent but prices slipped by 0.4 percent in Michigan, according to a recent federal study. "In California and other markets, the problem was that housing prices raced away from incomes," said Dana Johnson, chief economist at Detroit-based Comerica Bank. "What happened here is that incomes have just fallen away from home prices." Rather than speculative buyers on overextended credit, the region's housing bust is playing out as "a different, quieter story," Johnson said. "I think you have people who had every intention of paying off their mortgages and living in their houses and just couldn't," he said.