diff --git a/lib/wallet/txdb.js b/lib/wallet/txdb.js
index 47474d701..085be1a35 100644
--- a/lib/wallet/txdb.js
+++ b/lib/wallet/txdb.js
@@ -1083,6 +1083,7 @@ class TXDB {
     const details = new Details(wtx, block);
     const state = new BalanceDelta();
     const view = new CoinView();
+    let own = false;
 
     wtx.setBlock(block);
 
@@ -1126,6 +1127,7 @@ class TXDB {
 
         const path = await this.getPath(coin);
         assert(path);
+        own = true;
 
         details.setInput(i, path, coin);
 
@@ -1157,8 +1159,22 @@ class TXDB {
 
       details.setOutput(i, path);
 
-      const credit = await this.getCredit(hash, i);
-      assert(credit);
+      let credit = await this.getCredit(hash, i);
+
+      if (!credit) {
+        // This credit didn't belong to us the first time we
+        // saw the transaction (before confirmation or rescan).
+        // Create new credit for database.
+        credit = Credit.fromTX(tx, i, height);
+
+        // If this tx spent any of our own coins, we "own" this output,
+        // meaning if it becomes unconfirmed, we can still confidently spend it.
+        credit.own = own;
+
+        // Add coin to "unconfirmed" balance (which includes confirmed coins)
+        state.coin(path, 1);
+        state.unconfirmed(path, credit.coin.value);
+      }
 
       // Credits spent in the mempool add an
       // undo coin for ease. If this credit is
diff --git a/test/wallet-test.js b/test/wallet-test.js
index 20bbc67c6..165454590 100644
--- a/test/wallet-test.js
+++ b/test/wallet-test.js
@@ -18,8 +18,8 @@ const KeyRing = require('../lib/primitives/keyring');
 const Input = require('../lib/primitives/input');
 const Outpoint = require('../lib/primitives/outpoint');
 const Script = require('../lib/script/script');
-const PrivateKey = require('../lib/hd/private.js');
 const policy = require('../lib/protocol/policy');
+const HDPrivateKey = require('../lib/hd/private');
 
 const KEY1 = 'xprv9s21ZrQH143K3Aj6xQBymM31Zb4BVc7wxqfUhMZrzewdDVCt'
   + 'qUP9iWfcHgJofs25xbaUpCps9GDXj83NiWvQCAkWQhVj5J4CorfnpKX94AZ';
@@ -1220,7 +1220,7 @@ describe('Wallet', function() {
       );
     }
 
-    const privateKey = PrivateKey.generate();
+    const privateKey = HDPrivateKey.generate();
     const xpub = privateKey.xpubkey('main');
     watchWallet = await wdb.create({
       watchOnly: true,
@@ -1572,6 +1572,165 @@ describe('Wallet', function() {
     });
   });
 
+  it('should create credit if not found during confirmation', async () => {
+    // Create wallet and get one address
+    const wallet = await wdb.create();
+    const addr1 = await wallet.receiveAddress();
+
+    // Outside the wallet, generate a second private key and address.
+    const key2 = HDPrivateKey.generate();
+    const ring2 = KeyRing.fromPrivate(key2.privateKey);
+    const addr2 = ring2.getAddress();
+
+    // Build TX to both addresses, known and unknown
+    const mtx = new MTX();
+    mtx.addOutpoint(new Outpoint(Buffer.alloc(32), 0));
+    mtx.addOutput(addr1, 1020304);
+    mtx.addOutput(addr2, 4030201);
+    const tx = mtx.toTX();
+    const hash = tx.hash();
+
+    // Add unconfirmed TX to txdb (no block provided)
+    await wallet.txdb.add(tx, null);
+
+    // Check
+    const bal1 = await wallet.getBalance();
+    assert.strictEqual(bal1.tx, 1);
+    assert.strictEqual(bal1.coin, 1);
+    assert.strictEqual(bal1.confirmed, 0);
+    assert.strictEqual(bal1.unconfirmed, 1020304);
+
+    // Import private key into wallet
+    assert(!await wallet.hasAddress(addr2));
+    await wallet.importKey('default', ring2);
+    assert(await wallet.hasAddress(addr2));
+
+    // Confirm TX with newly-added output address
+    // Create dummy block
+    const block = {
+      height: 100,
+      hash: Buffer.alloc(32),
+      time: Date.now()
+    };
+
+    // Get TX from txdb
+    const wtx = await wallet.txdb.getTX(hash);
+
+    // Confirm TX with dummy block in txdb
+    const details = await wallet.txdb.confirm(wtx, block);
+    assert.bufferEqual(details.tx.hash(), hash);
+
+    // Check balance
+    const bal2 = await wallet.getBalance();
+    assert.strictEqual(bal2.confirmed, bal2.unconfirmed);
+    assert.strictEqual(bal2.confirmed, 5050505);
+    assert.strictEqual(bal2.coin, 2);
+    assert.strictEqual(bal2.tx, 1);
+
+    // Check for unconfirmed transactions
+    const pending = await wallet.getPending();
+    assert.strictEqual(pending.length, 0);
+
+    // Check history for TX
+    const history = await wallet.getHistory();
+    const wtxs = await wallet.toDetails(history);
+    assert.strictEqual(wtxs.length, 1);
+    assert.bufferEqual(wtxs[0].hash, hash);
+
+    // Both old and new credits are not "owned"
+    // (created by the wallet spending its own coins)
+    for (let i = 0; i < tx.outputs.length; i++) {
+      const credit = await wallet.txdb.getCredit(tx.hash(), i);
+      assert(!credit.own);
+    }
+  });
+
+  it('should create owned credit if not found during confirm', async () => {
+    // Create wallet and get one address
+    const wallet = await wdb.create();
+    const addr1 = await wallet.receiveAddress();
+
+    // Outside the wallet, generate a second private key and address.
+    const key2 = HDPrivateKey.generate();
+    const ring2 = KeyRing.fromPrivate(key2.privateKey);
+    const addr2 = ring2.getAddress();
+
+    // Create a confirmed, unspent, wallet-owned credit in txdb
+    const mtx1 = new MTX();
+    mtx1.addOutpoint(new Outpoint(Buffer.alloc(32), 0));
+    mtx1.addOutput(addr1, 1 * 1e8);
+    const tx1 = mtx1.toTX();
+    await wallet.txdb.add(tx1, null);
+
+    // Create dummy block
+    const block1 = {
+      height: 99,
+      hash: Buffer.alloc(32),
+      time: Date.now()
+    };
+    // Get TX from txdb
+    const wtx1 = await wallet.txdb.getTX(tx1.hash());
+
+    // Confirm TX with dummy block in txdb
+    await wallet.txdb.confirm(wtx1, block1);
+
+    // Build TX to both addresses, known and unknown
+    const mtx2 = new MTX();
+    mtx2.addTX(tx1, 0, 99);
+    mtx2.addOutput(addr1, 1020304);
+    mtx2.addOutput(addr2, 4030201);
+    const tx2 = mtx2.toTX();
+    const hash = tx2.hash();
+
+    // Add unconfirmed TX to txdb (no block provided)
+    await wallet.txdb.add(tx2, null);
+
+    // Check
+    const bal1 = await wallet.getBalance();
+    assert.strictEqual(bal1.tx, 2);
+    assert.strictEqual(bal1.coin, 1);
+    assert.strictEqual(bal1.confirmed, 1 * 1e8);
+    assert.strictEqual(bal1.unconfirmed, 1020304);
+
+    // Import private key into wallet
+    assert(!await wallet.hasAddress(addr2));
+    await wallet.importKey('default', ring2);
+    assert(await wallet.hasAddress(addr2));
+
+    // Confirm TX with newly-added output address
+    // Create dummy block
+    const block2 = {
+      height: 100,
+      hash: Buffer.alloc(32),
+      time: Date.now()
+    };
+
+    // Get TX from txdb
+    const wtx2 = await wallet.txdb.getTX(hash);
+
+    // Confirm TX with dummy block in txdb
+    const details = await wallet.txdb.confirm(wtx2, block2);
+    assert.bufferEqual(details.tx.hash(), hash);
+
+    // Check balance
+    const bal2 = await wallet.getBalance();
+    assert.strictEqual(bal2.confirmed, bal2.unconfirmed);
+    assert.strictEqual(bal2.confirmed, 5050505);
+    assert.strictEqual(bal2.coin, 2);
+    assert.strictEqual(bal2.tx, 2);
+
+    // Check for unconfirmed transactions
+    const pending = await wallet.getPending();
+    assert.strictEqual(pending.length, 0);
+
+    // Both old and new credits are "owned"
+    // (created by the wallet spending its own coins)
+    for (let i = 0; i < tx2.outputs.length; i++) {
+      const credit = await wallet.txdb.getCredit(tx2.hash(), i);
+      assert(credit.own);
+    }
+  });
+
   it('should cleanup', async () => {
     network.coinbaseMaturity = 2;
     await wdb.close();