diff --git a/contracts/DebtLocker.sol b/contracts/DebtLocker.sol
index a47fec2..1da2dd6 100644
--- a/contracts/DebtLocker.sol
+++ b/contracts/DebtLocker.sol
@@ -53,6 +53,8 @@ contract DebtLocker is IDebtLocker, DebtLockerStorage, MapleProxied {
         require(amount_ == uint256(0) || ERC20Helper.transfer(loan_.fundsAsset(), address(_loan), amount_));
 
         loan_.acceptNewTerms(refinancer_, calls_, uint256(0));
+
+        _principalRemainingAtLastClaim = loan_.principal();
     }
 
     function setFundsToCapture(uint256 amount_) override external {
@@ -209,19 +211,24 @@ contract DebtLocker is IDebtLocker, DebtLockerStorage, MapleProxied {
         require(!_isLiquidationActive(), "DL:HCOR:LIQ_NOT_FINISHED");
 
         address fundsAsset       = IMapleLoanLike(_loan).fundsAsset();
-        uint256 recoveredFunds   = IERC20Like(fundsAsset).balanceOf(address(this));  // Funds recovered from liquidation and any unclaimed previous payment amounts
-        uint256 principalToCover = _principalRemainingAtLastClaim;                   // Principal remaining at time of liquidation
+        uint256 principalToCover = _principalRemainingAtLastClaim;      // Principal remaining at time of liquidation
+        uint256 fundsCaptured    = _fundsToCapture;
+
+        // Funds recovered from liquidation and any unclaimed previous payment amounts
+        uint256 recoveredFunds = IERC20Like(fundsAsset).balanceOf(address(this)) - fundsCaptured;  
 
         // If `recoveredFunds` is greater than `principalToCover`, the remaining amount is treated as interest in the context of the pool.
         // If `recoveredFunds` is less than `principalToCover`, the difference is registered as a shortfall.
-        details_[0] = recoveredFunds;
+        details_[0] = recoveredFunds + fundsCaptured;
         details_[1] = recoveredFunds > principalToCover ? recoveredFunds - principalToCover : 0;
+        details_[2] = fundsCaptured;
         details_[5] = recoveredFunds > principalToCover ? principalToCover : recoveredFunds;
         details_[6] = principalToCover > recoveredFunds ? principalToCover - recoveredFunds : 0;
 
-        require(ERC20Helper.transfer(fundsAsset, _pool, recoveredFunds), "DL:HCOR:TRANSFER");
+        require(ERC20Helper.transfer(fundsAsset, _pool, recoveredFunds + fundsCaptured), "DL:HCOR:TRANSFER");
 
-        _repossessed = false;
+        _fundsToCapture = uint256(0);
+        _repossessed    = false;
     }
 
     function _handleClaim() internal returns (uint256[7] memory details_) {
diff --git a/contracts/test/DebtLocker.t.sol b/contracts/test/DebtLocker.t.sol
index 3a20cf3..f106187 100644
--- a/contracts/test/DebtLocker.t.sol
+++ b/contracts/test/DebtLocker.t.sol
@@ -532,7 +532,8 @@ contract DebtLockerTest is TestUtils {
 
         uint256 principalAfter = loan.principal();
 
-        assertEq(principalBefore + principalIncrease_, principalAfter);
+        assertEq(principalBefore + principalIncrease_,      principalAfter);
+        assertEq(debtLocker.principalRemainingAtLastClaim(), principalAfter);
     }
 
     function test_fundsToCaptureForNextClaim() public {
@@ -590,4 +591,39 @@ contract DebtLockerTest is TestUtils {
         pool.claim(address(debtLocker));
     }
 
+    function test_fundsToCaptureWhileInDefault() public {
+        ( loan, debtLocker ) = _createFundAndDrawdownLoan(1_000_000);
+
+        // Prepare additional amount to be captured
+        fundsAsset.mint(address(debtLocker), 500_000);
+
+        assertEq(fundsAsset.balanceOf(address(debtLocker)),  500_000);
+        assertEq(fundsAsset.balanceOf(address(pool)),        0);
+        assertEq(debtLocker.principalRemainingAtLastClaim(), loan.principalRequested());
+        assertEq(debtLocker.fundsToCapture(),                0);
+
+        // Trigger default
+        hevm.warp(loan.nextPaymentDueDate() + loan.gracePeriod() + 1);
+
+        pool.triggerDefault(address(debtLocker));
+
+        // After triggering default, set funds to capture
+        poolDelegate.debtLocker_setFundsToCapture(address(debtLocker), 500_000);
+
+        // Claim
+        uint256[7] memory details = pool.claim(address(debtLocker));
+
+        assertEq(fundsAsset.balanceOf(address(debtLocker)),  0);
+        assertEq(fundsAsset.balanceOf(address(pool)),        500_000);
+        assertEq(debtLocker.fundsToCapture(),                0);
+
+        assertEq(details[0], 500_000);
+        assertEq(details[1], 0);
+        assertEq(details[2], 500_000);
+        assertEq(details[3], 0);
+        assertEq(details[4], 0);
+        assertEq(details[5], 0);
+        assertEq(details[6], loan.principalRequested()); // No principal was recovered
+    }
+
 }