                          RECOMMENDED FOR FULL-TEXT PUBLICATION
                              Pursuant to Sixth Circuit I.O.P. 32.1(b)
                                       File Name: 13a0112p.06

                 UNITED STATES COURT OF APPEALS
                                   FOR THE SIXTH CIRCUIT
                                     _________________


                                                X
                           Plaintiff-Appellee, -
 UNITED STATES OF AMERICA,
                                                 -
                                                 -
                                                 -
                                                     No. 11-2018
           v.
                                                 ,
                                                  >
                                                 -
                       Defendant-Appellant. -
 ERIC PAUL WENDLANDT,
                                                N
                   Appeal from the United States District Court
              for the Western District of Michigan at Grand Rapids.
                No. 1:11-cr-5-1—Robert J. Jonker, District Judge.
                              Decided and Filed: April 19, 2013
       Before: SUTTON and GRIFFIN, Circuit Judges; DOWD, District Judge.*

                                       _________________

                                             COUNSEL
ON BRIEF: David A. Dodge, DODGE & DODGE, P.C., Grand Rapids, Michigan, for
Appellant. Mark A. Totten, UNITED STATES ATTORNEY’S OFFICE, Grand Rapids,
Michigan, for Appellee.
                                       _________________

                                             OPINION
                                       _________________

         GRIFFIN, Circuit Judge.            Defendant Eric Wendlandt appeals his above-
Guidelines sentence of forty-two months of imprisonment imposed after he pled guilty
to one count of conspiracy to defraud the United States in violation of 18 U.S.C. § 371.
His conviction stems from a mortgage fraud scheme that caused the U.S. Department of
Housing and Urban Development (“HUD”) to insure loans for unqualified applicants



         *
          The Honorable David D. Dowd, Jr., Senior United States District Judge for the Northern District
of Ohio, sitting by designation.


                                                   1
No. 11-2018        USA v. Wendlandt                                                Page 2


based upon forged documents and false information provided by Wendlandt. The
substantial financial losses to HUD that ensued were, of course, inevitable.

       On appeal, Wendlandt contends that his sentence is both procedurally and
substantively unreasonable.     Specifically, he challenges both the district court’s
computation of financial loss for purposes of determining his offense level under
U.S.S.G. § 2B1.1 (Nov. 1, 2010), and also the court’s decision to vary upward from the
advisory Guidelines range of twenty-four to thirty months in prison. For the reasons that
follow, we conclude that Wendlandt’s claims are without merit and therefore affirm his
sentence.

                                            I.

       Eric Wendlandt devised a mortgage fraud scheme that began sometime prior to
February 2008 and continued to March 2010, in Kent County, Michigan. HUD, through
the Federal Housing Administration (“FHA”), administered a mortgage insurance
program designed to ensure adequate housing for low-income individuals by providing
mortgage insurance to lenders who made home loans to those individuals. In order to
receive an FHA-insured loan, home buyers were required to establish that their income
was sufficient to meet the mortgage payments. HUD required the lenders making the
loans to verify the potential buyers’ employment and income, which could be
accomplished by submitting a “Verification of Employment” form, pay stubs, and other
documentation. HUD granted so-called Direct Endorsement Authority for FHA loans
to certain lenders. Under this program, the lender determined whether the home buyer
was eligible for an FHA-insured loan, and, if so, the lender submitted the application and
requisite documentation to HUD. Wendlandt’s mortgage brokerage company, Precise
Mortgage, was never granted Direct Endorsement Authority.

       Nonetheless, starting in February 2008, Wendlandt and codefendant Pleasz
Daniels, who was employed by Precise Mortgage as a mortgage broker, initiated a
scheme to defraud HUD by using forged and counterfeited documents, and false
information, to secure FHA-insured loans for otherwise unqualified buyers who
appeared to satisfy the agency’s requirements. Wendlandt fraudulently represented to
No. 11-2018            USA v. Wendlandt                                                           Page 3


HUD that the loans originated with Indigo Financial (“Indigo”), a mortgage company
that did possess Direct Endorsement Authority. Wendlandt and the owner of Indigo
were friends. As a result of Wendlandt’s scheme, unqualified buyers were approved for
home loans insured by the FHA, and when the buyers defaulted on their mortgage
payments, HUD was required to reimburse the lending institutions for losses incurred
in foreclosure. Meanwhile, Wendlandt and Daniels enriched themselves by collecting
commissions and fees charged for originating the fraudulent loans.

         In March 2010, after auditing several suspicious Precise Mortgage files, HUD
investigators interviewed Wendlandt regarding improprieties in the origination of
numerous FHA-insured mortgages. Wendlandt admitted to Special Agent Jason Russell
that Precise Mortgage had initiated approximately one hundred FHA mortgages that
were then processed by Indigo. Wendlandt estimated that twenty percent of these
mortgages were fraudulent.

         In January 2011, the government charged Wendlandt with conspiracy to defraud
the United States, 18 U.S.C. § 371. One week later, he entered into a written plea
agreement and pled guilty to the charge.

         The district court sentenced Wendlandt on August 9, 2011. The central issue in
dispute was the computation of the financial loss incurred by HUD for sentencing
purposes under U.S.S.G. § 2B1.1(b)(1) (Nov. 1, 2010), which increases the base offense
level proportionate to the loss associated with the crime. The loss calculation was
derived from the three fraudulent mortgages underlying the felony information, for the
following properties in Grand Rapids, Michigan: (1) 3015 Plainfield Avenue, NE;
(2) 834 Sherman Avenue, SE; and (3) 7174 Martin Avenue, SE.1

         The government’s “best estimate” of the total pecuniary loss to HUD arising
from these failed loans was $262,790.48, using a comparative market analysis (2010 and
2011 median sales prices) prepared by HUD appraiser Kathy Coon. With regard to the


         1
           Prior to the sentencing hearing, the government conceded that a fourth property should not be
included in the calculation of loss because the fraudulent loan was processed by codefendant Daniels after
he left Precise Mortgage’s employment.
No. 11-2018        USA v. Wendlandt                                                Page 4


Martin Avenue and Sherman Avenue properties, the government’s loss estimation of
$97,276.36 and $139,437.22, respectively, was based upon a formula that subtracted the
fair market value of the properties from the outstanding loan balance or claim paid by
HUD. The mortgage for the Plainfield Avenue property had been modified by the lender
to allow the borrower to stay in the home and, because the post-modification loan was
issued on the basis of legitimate credit and earnings information, default was unlikely.
The government therefore asserted that the normal “loan balance minus fair market
value” equation was irrelevant, and the proper measure of loss with respect to this
property was the amount HUD reimbursed the lender for principal and interest foregone
in the modification, $26,076.90. The government filed a motion for an upward variance,
arguing that a sentence above the recommended Guidelines range was warranted because
the financial loss to HUD did not adequately measure the seriousness of the crime or its
collateral effects on individuals and the community at large.

       Wendlandt opposed the government’s motion, contending that the circumstances
of his crime did not justify a heightened sentence. In addition, Wendlandt filed a motion
for a downward variance, in which he asserted that the factors under 18 U.S.C. § 3553(a)
favored a lower sentence. Wendlandt submitted his own appraisals of the three
properties in question, prepared by certified appraiser Karen Leppek using a sales-
comparison approach. Wendlandt’s position was that in light of unforeseen market
developments (the burst in the housing bubble) and the government’s purportedly
deficient proofs regarding losses attributable to him, the amount of loss should be zero
or no greater than an eight-level enhancement under U.S.S.G. § 2B1.1(b)(E) (a loss
greater than $70,000 but less than $120,000).

       At the sentencing hearing, the parties’ appraisers testified as to their valuations
of the three properties. Karen Leppek opined that the government’s appraisals were
liquidation values not representative of the fair market value of the properties. Two of
the mortgagors who fell victim to Wendlandt’s fraud testified about his deceptions and
the enormous hidden fees, costs, and financial losses they incurred. Special Agent
No. 11-2018         USA v. Wendlandt                                                 Page 5


Russell testified about the details of HUD’s underlying investigation and his interview
with Wendlandt.

        At the conclusion of the hearing, the district court adopted the government’s loss
calculation of $262,790.48. To calculate the Guidelines range, the court started with the
base offense level of six points, applied a twelve-level enhancement representing a loss
amount between $200,000 and $400,000 under § 2B1.1(b)(1)(G), added two points for
Wendlandt’s leadership role in the offense, and then subtracted three points for
acceptance of responsibility and a timely plea. With a total offense level of seventeen
and a criminal history category I, the advisory Guidelines range was twenty-four to thirty
months of imprisonment. The court reviewed the relevant § 3553(a) factors on the
record, granted the government’s motion for an upward variance, and sentenced
Wendlandt to forty-two months in prison, three years of supervised release, and
$165,514.12 in restitution.

        Wendlandt now timely appeals his sentence, arguing the district court
procedurally erred in calculating the loss amount for purposes of U.S.S.G. § 2B1.1, and
that the court’s upward variance is substantively unreasonable.

                                            II.

        “We review a district court’s sentence for abuse of discretion, whether inside,
just outside, or significantly outside the Guidelines range, and for both procedural and
substantive reasonableness.” United States v. Cunningham, 669 F.3d 723, 728 (6th Cir.
2012) (citation and internal quotation marks omitted). Procedural reasonableness review
involves “ensur[ing] that the district court properly calculated the Guidelines range, did
not treat the Guidelines as mandatory, considered the factors set out in 18 U.S.C.
§ 3553(a), did not select a [sentence] based on clearly erroneous facts, and adequately
explained its sentence.” Id.

        “When reviewing a district court’s application of section 2B1.1(b)(1), we review
the district court’s factual finding as to amount of loss for clear error.” United States v.
Jones, 641 F.3d 706, 712 (6th Cir. 2011). The method used to calculate loss is reviewed
No. 11-2018         USA v. Wendlandt                                                   Page 6


de novo. United States v. Warshak, 631 F.3d 266, 328 (6th Cir. 2010). “An error with
respect to the loss calculation is a procedural infirmity that typically requires remand.”
Id.

        In determining loss under U.S.S.G. § 2B1.1, the court must use the greater of
actual or intended loss. U.S.S.G. § 2B1.1 cmt. n.3(A). The Guidelines define “actual
loss” as “reasonably foreseeable pecuniary harm,” which connotes the monetary harm
“the defendant knew or, under the circumstances, reasonably should have known, was
a potential result of the offense.” Id. at cmt. n.3(A)(i), (iii), (iv). “Intended loss” is “the
pecuniary harm that was intended to result from the offense,” including “pecuniary harm
that would have been impossible or unlikely to occur.” Id. at cmt. n.3(A)(ii).

        Because of the difficulties often associated with attempting to calculate loss in
a fraud case, the district court “need only make a reasonable estimate” of the loss using
a preponderance of the evidence standard. Jones, 641 F.3d at 712 (quoting U.S.S.G.
§ 2B1.1 cmt. n.3(C)); see also United States v. Howley, 707 F.3d 575, 583 (6th Cir.
2013) (“The Guidelines require only a reasonable estimate of actual or intended loss
within broad ranges.”) (quotation marks omitted). “[T]he Sentencing Guidelines import
the legal concept of a causal relationship between the defendant’s conduct and the
determined loss.” United States v. Rothwell, 387 F.3d 579, 583 (6th Cir. 2004).
“Default by a woefully unqualified home-loan borrower is so likely that . . . the
pecuniary harm . . . will almost invariably include the full amount of unpaid principal
on the fraudulently obtained loan.” United States v. Turk, 626 F.3d 743, 750 (2d Cir.
2010) (citation and internal quotation marks omitted).

        In the present context—a fraud crime involving collateral pledged or otherwise
provided by the defendant—the district court must reduce the loss by the amount of
money the victim recovered by selling the collateral, or the fair market value of the
property at the time of sentencing if the victim has not disposed of the collateral.
U.S.S.G. § 2B1.1 cmt. n.3(E)(ii); United States v. Minor, 488 F. App’x 966, 969
(6th Cir. 2012) (per curiam); United States v. VanderZwaag, 467 F. App’x 402, 413
(6th Cir. 2012).
No. 11-2018           USA v. Wendlandt                                                  Page 7


           Wendlandt argues that the district court erred in computing the loss under
U.S.S.G. § 2B1.1(b)(1), resulting in an incorrect Guidelines range. In a nutshell, he
maintains that the court should not have accepted what he considers HUD’s
commercially unreasonable “fire-sale” valuations, and that the court attributed losses to
him that were neither sufficiently documented nor directly attributable to his crime for
several reasons.

           As a preliminary matter, we can quickly dispatch one of Wendlandt’s
arguments—that he should have received a larger credit against loss because of the
unforeseeable downturn in the housing market and the diminishment in the value of the
three properties. We recently addressed and rejected this very argument in Minor,
stating:

           Unlike the application note regarding the determination of loss, the
           application note regarding credits against loss does not speak in terms of
           foreseeability. [U.S.S.G. § 2B1.1 cmt. n.3(A), (E)]. The sentencing
           guidelines, therefore, require foreseeability of the loss of the unpaid
           principal, but do not require foreseeability with respect to the future
           value of the collateral.

Minor, 488 F. App’x at 969. See also United States v. Mallory, 461 F. App’x 352, 361
(4th Cir. 2012) (per curiam) (“[I]t is of no consequence that the housing collapse was not
reasonably foreseeable to Mallory. He receives the benefit of what the victims
recovered, not what they foreseeably might have recovered.”); Turk, 626 F.3d at 751
(“[A]ll of [the defendant’s] arguments about the extrinsic forces that caused the value
of the collateral to decline are simply irrelevant—they may or may not be true, and she
might have earned a credit against loss if they had not occurred, but she may not invoke
them to insulate her from responsibility for the loss she caused, namely, the loss of the
unpaid loan principal.”). The plain language of the Guideline does not require that we
factor extrinsic market conditions into the calculation of credits against loss.
No. 11-2018         USA v. Wendlandt                                                Page 8


                              A. The Plainfield Property

        Unlike the other two properties at issue in this case, after Wendlandt prepared the
false documents to qualify a buyer for the HUD-insured loan to purchase the Plainfield
property, the buyer successfully sought a loan modification that reduced the monthly
payment. HUD was required to make a $26,076.90 insurance payment to the lender,
which equaled the amount by which the lender reduced the loan as a result of the
modification. The district court found that this amount represented the actual loss
attributable to Wendlandt.

        Wendlandt contends that in the case of a performing loan, any loss to HUD
would be the difference between the appraised fair market value of the property and the
balance remaining on the loan (according to his computation, $72,616.46). He argues
that because the appraised value—either the government’s appraisal of $96,900 or
Leppek’s appraisal of $107,500—exceeds the loan balance, the loss is zero.

        However, as the district court found, the cost of the subsequent loan modification
constitutes a reasonably foreseeable, calculable loss to HUD that falls squarely within
the definition of actual loss under § 2B1.1 cmt. n.3(A)(i), (iii). When Wendlandt
fraudulently procured the HUD-insured loan for the otherwise unqualified borrower, he
knew, or reasonably should have known, that the borrower might have to seek a loan
modification to maintain monthly payments on the mortgage. Serendipitously for
Wendlandt, the buyer of the Plainfield property was able to obtain the loan modification
rather than resort to other alternatives such as default, which would have resulted in a
much higher loss.

        Moreover, the loss amount adopted by the district court was a reasonable
estimate supported by a preponderance of the evidence. Agent Russell and Kathy Coon
testified that $26,076.90 was the amount of the insurance claim filed by the lender, that
HUD was required under its insurance program to pay this difference in the
modification, and that this was a permanent loss because HUD would not receive
reimbursement if the owner sold the house for a higher price. Thus, the district court did
not clearly err in its loss calculation pertaining to the Plainfield property.
No. 11-2018         USA v. Wendlandt                                                  Page 9


                                B. The Martin Property

        The buyer of the Martin property was codefendant Daniels. According to Agent
Russell, Wendlandt admitted that he wrote two large fraudulent paychecks to Daniels,
with the agreement that Daniels would cash the checks and then return the money to
create the appearance that Daniels had a high income. Wendlandt knew that Daniels
intended to purchase the house not to live in, but to run as an adult foster care program,
which violated the terms of FHA loans. Wendlandt helped secure a highly inflated
appraisal so that Daniels could use the loan to purchase both the house and the existing
business. Daniels pled guilty in federal court to felony fraud on April 19, 2011, and his
sentencing was pending at the time Wendlandt was sentenced.

        At Wendlandt’s sentencing hearing, the government anticipated that the property
was “almost certain to go into default” after Daniels’ sentencing and likely
imprisonment, and argued that the loss amount attributable to Wendlandt on account of
this fraudulent loan should be $97,276.36, the difference between the government’s
proffered fair market value of $99,900 and the remaining balance on the fraudulent loan,
$197,176.36. Defense counsel represented to the court that Daniels’ mother was going
to take over the loan payments and, consequently, the loss amount should be zero
because this mortgage was not in default at the time of sentencing. The district court
adopted the government’s proposed loss formula for the Martin property.

        Wendlandt’s argument that the loss amount should be zero because there was not
actual loss at the time of sentencing overlooks the relevance of “intended loss” under
§ 2B1.1. The Guideline instructs a sentencing court to include the greater of actual or
intended loss, the latter being the “pecuniary harm that was intended to result from the
offense.” U.S.S.G. § 2B1.1 cmt. n.3(A)(ii). Our court has further defined intended loss
“as the loss the defendant subjectively intended to inflict on the victim,” not the potential
loss (the gross amount of a fraudulently obtained loan). United States v. Moored,
38 F.3d 1419, 1427 (6th Cir. 1994). Although we have subsequently reaffirmed
Moored’s definition in two cases without extensive discussion, see United States v.
Newson, 351 F. App’x 986, 988 (6th Cir. 2009); United States v. Wade, 266 F.3d 574,
No. 11-2018         USA v. Wendlandt                                               Page 10


586 (6th Cir. 2001), Moored interpreted a sentencing Guideline, U.S.S.G. § 2F1.1, which
has since been materially amended in 2001 to delete references to “expected” and
“probable” loss, and consolidated with U.S.S.G. § 2B1.1. Our court has not had
occasion to address the meaning of “intended loss” under the current version of § 2B1.1,
and it is worth noting that there is considerable disagreement among our sister circuits
as to what the optimal measure of “intended loss” should be—an objective or subjective
analysis, and whether constructive, as opposed to actual, intent will suffice. See
generally Gabrielle A. Bernstein, Comment, The Role of Expectations in Assessing
Intended Loss in Mortgage-Fraud Schemes, 2010 U. Chi. Legal Forum 337, 341-42
(2010) (and cases collected therein).

        However, although the parties now debate its fine points, the present case is not
the appropriate vehicle to resolve this complex issue because the topic of “intended loss”
in reference to the Martin property was never raised below by Wendlandt, and the
formula employed by the district court was, under the generous latitude afforded by the
“reasonable estimate” standard, an acceptable and accurate measure of “the pecuniary
harm that was intended to result from [Wendlandt’s] offense.” See United States v.
Appolon, 695 F.3d 44, 69 (1st Cir. 2012) (holding that the district court’s calculation of
intended loss as the original mortgage loan amount less the property’s assessed value at
the time of sentencing “was a reasonable proxy for culpability in the circumstances of
th[e] case,” where the defendants were “veterans of the real estate industry” who “knew
that the mortgage loans on the properties involved in their scheme would enter default”
and “that the properties would be grossly devalued as a result”); United States v. McCoy,
508 F.3d 74, 79 (1st Cir. 2007) (“As McCoy was obtaining loans for individuals with
low income and poor credit, he could—and should—have expected that the banks would
probably recover only the value of the mortgaged properties. Intended loss was
therefore the value of the loans less the expected value of the properties.”).

        The district court heard ample testimony from Agent Russell about Wendlandt’s
admitted central role in fraudulently securing the loan for the Martin property, and we
have no reason to conclude that the court clearly erred in crediting this testimony, or that
No. 11-2018        USA v. Wendlandt                                              Page 11


the government’s valuation of the property, accepted by the district court, was “outside
the realm of permissible computations.” United States v. Lutz, 154 F.3d 581, 590 (6th
Cir. 1998).

                              C. The Sherman Property

       At the time of Wendlandt’s sentencing, the Sherman property already had gone
into foreclosure, requiring HUD to reimburse the mortgage lender $159,337.22 in loan
proceeds and foreclosure costs. The district court found by a preponderance of the
evidence that the government’s appraisal of $19,900 represented a reasonable estimate
of the property’s fair market value and, subtracting this valuation from HUD’s
reimbursement costs, found the loss amount to be $139,437.22.

       Wendlandt contends that because this mortgage was a refinance obtained by the
borrower in order to lower payments so that he could afford to keep the property, the
district court should have subtracted from the loss an amount equal to the outstanding
balance on the original loan at the time of refinancing—that is, if the original loan was
HUD-insured. Wendlandt reasons that if this factual predicate is true, HUD was already
“on the hook” for the original loan. He further asserts that his proffered fair market
value of $60,000 is more accurate than the government’s liquidation value of $19,900.

       Whether or not HUD insured the original loan to purchase the Sherman property
is of no moment. HUD agreed to insure the refinance on the basis of Wendlandt’s
fraudulent representations; absent these falsities, HUD would never have insured the
buyer. HUD’s obligation to pay on the lender’s claim is directly attributable to
Wendlandt’s wrongdoing.

       Moreover, the district court’s adoption of the government’s $19,900 fair market
value is entitled to appropriate deference. It was derived from the testimony of appraiser
Coon, who looked at comparable properties in the area that sold for prices between
$5,900 and $87,500. The median value of the sale prices for all of these similarly
situated properties was $19,900. At the time of sentencing, the Sherman property had
not yet sold, and HUD did not have it on the market. Coon testified that HUD
No. 11-2018        USA v. Wendlandt                                              Page 12


previously had listed the house twice—at $16,000 and then at $22,000, albeit in a
relatively short time period. She concluded that $19,900 represented the fair market
value of the property. Although Wendlandt’s appraiser Karen Leppek arrived at a much
higher fair market value, Coon’s estimate represented an equally valid estimate of the
property’s fair market value using a standard appraisal method.

       To the extent Wendlandt complains that the government’s valuation is an unfair
“fire-sale” price and that we are bound to follow the burden-shifting commercial
reasonableness standard in United States v. Willis, 593 F.2d 247, 258–59 (6th Cir. 1979),
we disagree. Willis is inapposite. It involved the collection of a lawful secured debt and
the commercially reasonable disposition of collateral pursuant to the requirements of the
Uniform Commercial Code. The sentencing Guidelines contain no such requirement and
call for only a reasonable estimate of the fair market value. See United States v. Lacey,
699 F.3d 710, 720 (2d Cir. 2012) (“While a fact-finder would be entitled to take into
account the distressed circumstances of ‘underwater’ property owners in deciding
whether a short-sale price accurately reflects the fair market value of the property, no
rule of law disqualifies such a sale as evidence of the fair market value.”).

       In sum, we find nothing in the district court’s calculation of loss under § 2B1.1
that renders Wendlandt’s sentence procedurally unreasonable.

                                           III.

       Wendlandt also challenges the substantive reasonableness of his sentence,
objecting to the district court’s twelve-month upward variance on several grounds.

       A sentence is substantively unreasonable if the sentencing court arbitrarily
selected the sentence, based the sentence on impermissible factors, failed to consider
pertinent § 3553(a) factors, or gave an unreasonable amount of weight to any pertinent
factor. Cunningham, 669 F.3d at 733. “When a district court considers the relevant
3553(a) factors in-depth and reaches its determination that the appropriate sentence
varies outside the advisory guidelines range, we are very reluctant to find the sentence
unreasonable.” United States v. Collington, 461 F.3d 805, 811 (6th Cir. 2006).
No. 11-2018        USA v. Wendlandt                                              Page 13


“Although we may consider the extent of the deviation in reviewing a district court’s
sentence, we ‘must give due deference to the district court’s decision that the § 3553(a)
factors, on a whole, justify the extent of the variance.’” United States v. Lanning,
633 F.3d 469, 476 (6th Cir. 2011) (quoting Gall v. United States, 552 U.S. 38, 51
(2007)).

       At sentencing, the district court concluded that the measure of loss under
U.S.S.G. § 2B1.1 did not accurately reflect Wendlandt’s culpability—the costs to the
government stemming from his lies were not only monetary, but involved considerable
time and effort in investigating the matter; moreover, Wendlandt admitted his
involvement in at least twenty fraudulent loans, not merely the three loans that were the
focal point of the prosecution. This, in the eyes of the court, constituted a “serious
wrongdoing, and it’s a pattern of wrongdoing.”

       Wendlandt’s contention that the court’s finding that he committed mortgage
fraud on at least twenty occasions is based on “speculation” rings hollow. According
to Agent Russell, Wendlandt admitted during his interview that of the one hundred loans
originated through Indigo, approximately twenty were obtained using fraudulent
documents. Wendlandt made the tactical decision to withdraw his objection to this point
at sentencing, and he cannot now attempt to resurrect an objection that he expressly
waived below.

       The district court also considered Wendlandt’s character—or lack thereof—and
his “troubling tendency to diminish and minimize the nature of his wrongdoing” as a
factor warranting the upward variance. In this regard, the court cited the sentencing-
hearing testimony of two of Wendlandt’s disgruntled clients, whose disastrous mortgage
transactions with Wendlandt indicated an ingrained pattern of wrongdoing and predatory
lending practices on Wendlandt’s part. One of the borrowers, a retiree, was saddled with
a balloon mortgage that carried a monthly payment of over $800, a 15.9% interest rate,
settlement charges to Wendlandt of over $14,000, a loan origination fee of $6,000, and
delivery costs of $1,500—all on a refinance loan for $61,000 that was substantially
higher than the $51,000 remaining balance on the retiree’s original loan. Faced with the
No. 11-2018        USA v. Wendlandt                                              Page 14


threat of foreclosure, the borrower deeded his house to the mortgage holder who,
unbeknownst to the borrower, was Wendlandt’s brother. Although Wendlandt told the
borrower that he had thirty days to vacate the premises, the borrower was locked out of
his house the next day, unable to retrieve most of his personal belongings.

       The second borrower told a similar story. She testified that her financial
resources were depleted as a result of Wendlandt’s misrepresentations as to the terms
and conditions of her loan and the related exorbitant fees, charges, and interest rate.

       The sentencing record confirms that the government offered this testimony not
as relevant conduct under U.S.S.G. § 1B1.3, but rather as information illustrative of
Wendlandt’s poor character, and that the court used the evidence for that specific
§ 3553(a) purpose. Although Wendlandt argues that the victims’ mortgage problems
were not directly attributable to him, but were caused by their own mismanagement, the
district court reasonably concluded that Wendlandt’s dealings with these victims, albeit
not illegal per se, constituted unethical practices that reflected poorly on Wendlandt’s
character and supported an upward variance.

       The district court also took into account the fact that seven days after Wendlandt
entered his guilty plea, he applied for a mortgage payment reduction under the federal
Making Home Affordable Program and signed a Dodd-Frank Certification in which he
falsely represented that he did not have a felony conviction in the past ten years. The
court noted that it had advised Wendlandt twice during his plea colloquy that if he pled
guilty, he would be convicted of a crime.

       Finally, although the district court credited Wendlandt under U.S.S.G. § 3E1.1
for his acceptance of responsibility, in varying upward it noted Wendlandt’s “initial
denials of wrongdoing and limited recognition of wrongdoing, and finally, . . .
[g]rudging acceptance.” Wendlandt maintains that this characterization is unfair, yet it
is substantiated by the record, which shows that during various stages of the case,
Wendlandt minimized the gravity of his conduct, attempted to blame the victims, and,
during his sentencing allocution, expressed regrets for his family, but not the victims.
No. 11-2018        USA v. Wendlandt                                              Page 15


       In light of this record, the upward variance was not substantively unreasonable,
but was justified by the breadth and seriousness of Wendlandt’s crime. See United
States v. Watkins, 691 F.3d 841, 853–54 (6th Cir. 2012) (affirming a twenty-one month
upward variance in light of the defendant’s egregious conduct and ongoing involvement
in a government bribery and corruption scandal); Lanning, 633 F.3d at 476 (finding no
abuse of discretion in an upward variance of forty-two months of imprisonment where
the defendant’s applicable Guidelines range “was for the general crimes of theft or
forgery, but these broad categories [did] not reflect the specific activity of repeatedly
stealing individuals’ checks out of their mailboxes and altering them for [the
defendant’s] pecuniary gain”).

                                          IV.

       For the foregoing reasons, we affirm Wendlandt’s sentence.
