How much can someone charge on a loan mod?

[Herm M.]

A lot of us short-sale flippers have the same goal: to find as many listings as possible. But we all run into people who aren't willing to short-sale their property, and they would like to attempt a loan mod.

I haven't done any loan mods, but the lady I work with does them occasionally, and charges $2500.

Getting a loan mod and versus getting a short-sale approval is essentially the same amount of work. A short-sale flip in California will make us $25,000+ per deal, so I don't see it being worth our time to do the same amount of work for only 10% of the income.

So here's my question:

Can we charge our clients based on how much we reduce their principal loan balance, on top of the $2500 standard fee?

We will be collecting nothing up-front.

Let's say someone owes $600,000, and successfully complete their loan mod and their balance is reduced to $500,000, not to mention I get their rate dropped. I will charge $2500 for dropping the rate...and I want to charge a percentage (I'm thinking 7%) on how much I reduce their principal.

So in this scenario, I would charge $2500 + $7000, because I reduced their balance by $100,000.

As long as the customer agrees, is this legal?