diff --git a/src/lib/components/chat/Chat.svelte b/src/lib/components/chat/Chat.svelte
index 7abc1d53e9..b1795f9b98 100644
--- a/src/lib/components/chat/Chat.svelte
+++ b/src/lib/components/chat/Chat.svelte
@@ -729,6 +729,10 @@
 		);
 	};
 
+	$: if ($terminalServers !== null && $selectedTerminalId && !isTerminalAvailable($selectedTerminalId)) {
+		selectedTerminalId.set(null);
+	}
+
 	let settingDefaults = false;
 	const setDefaults = async () => {
 		if (settingDefaults) return;
@@ -1286,11 +1290,6 @@
 			});
 		}
 
-		// Clear stale selectedTerminalId if the referenced terminal no longer exists
-		if ($selectedTerminalId && !isTerminalAvailable($selectedTerminalId)) {
-			selectedTerminalId.set(null);
-		}
-
 		const pageSubscribe = page.subscribe(async (p) => {
 			if (p.url.pathname === '/' || p.url.pathname.startsWith('/folders/')) {
 				await tick();
diff --git a/src/lib/components/chat/ChatControls.svelte b/src/lib/components/chat/ChatControls.svelte
index 488e59be04..8344e51c18 100644
--- a/src/lib/components/chat/ChatControls.svelte
+++ b/src/lib/components/chat/ChatControls.svelte
@@ -110,6 +110,7 @@
 	// Clear selected direct terminal if user lost permission
 	$: if (
 		$selectedTerminalId &&
+		$terminalServers !== null &&
 		!($terminalServers ?? []).some((t) => t.id && t.id === $selectedTerminalId) &&
 		!($user?.role === 'admin' || ($user?.permissions?.features?.direct_tool_servers ?? true))
 	) {
diff --git a/src/lib/components/chat/MessageInput.svelte b/src/lib/components/chat/MessageInput.svelte
index 44a4b49e55..883bdbad08 100644
--- a/src/lib/components/chat/MessageInput.svelte
+++ b/src/lib/components/chat/MessageInput.svelte
@@ -696,7 +696,7 @@
 	}
 
 	// Clear selected terminal when model doesn't support terminal
-	$: if ($selectedTerminalId && terminalCapableModels.length === 0) {
+	$: if ($selectedTerminalId && selectedModelIds.length > 0 && terminalCapableModels.length === 0) {
 		selectedTerminalId.set(null);
 	}
 
diff --git a/src/lib/stores/index.ts b/src/lib/stores/index.ts
index 97455c32f8..c213977f32 100644
--- a/src/lib/stores/index.ts
+++ b/src/lib/stores/index.ts
@@ -94,7 +94,7 @@ export const adminLeaderboardCount: Writable<number | null> = writable(null);
 export const adminFeedbackCount: Writable<number | null> = writable(null);
 
 export const toolServers = writable([]);
-export const terminalServers = writable([]);
+export const terminalServers: Writable<any[] | null> = writable(null);
 
 // Persistent Pyodide worker for code interpreter FS
 export const pyodideWorker: Writable<Worker | null> = writable(null);
diff --git a/src/routes/(app)/+layout.svelte b/src/routes/(app)/+layout.svelte
index af267e55f2..7e4daa94f7 100644
--- a/src/routes/(app)/+layout.svelte
+++ b/src/routes/(app)/+layout.svelte
@@ -184,7 +184,7 @@
 				name: t.name,
 				key: localStorage.token
 			}));
-			terminalServers.update((existing) => [...existing, ...terminalEntries]);
+			terminalServers.update((existing) => [...(existing ?? []), ...terminalEntries]);
 		}
 	};
 
@@ -264,9 +264,10 @@
 			}).catch((e) => console.error('Failed to load user settings:', e))
 		]);
 
-		const loadToolServers = setToolServers().catch((e) =>
-			console.error('Failed to load tool servers:', e)
-		);
+		const loadToolServers = setToolServers().catch((e) => {
+			console.error('Failed to load tool servers:', e);
+			terminalServers.set([]);
+		});
 		if (
 			$page.url.searchParams.get('q') &&
 			($page.url.searchParams.get('submit') ?? 'true') === 'true'