diff --git a/app/api/nextcloud/status/route.ts b/app/api/nextcloud/status/route.ts
index 260bba7d..e07dbafd 100644
--- a/app/api/nextcloud/status/route.ts
+++ b/app/api/nextcloud/status/route.ts
@@ -52,6 +52,21 @@ async function parseXMLResponse(response: Response): Promise<any> {
 
 async function createFolder(nextcloudUrl: string, username: string, password: string, folderPath: string) {
   try {
+    // First check if folder exists
+    const checkResponse = await fetch(`${nextcloudUrl}/remote.php/dav/files/${encodeURIComponent(username)}/${encodeURIComponent(folderPath)}`, {
+      method: 'PROPFIND',
+      headers: {
+        'Authorization': `Basic ${Buffer.from(`${username}:${password}`).toString('base64')}`,
+        'Depth': '0',
+      },
+    });
+
+    if (checkResponse.ok) {
+      console.log(`Folder ${folderPath} already exists`);
+      return;
+    }
+
+    // If folder doesn't exist, create it
     const response = await fetch(`${nextcloudUrl}/remote.php/dav/files/${encodeURIComponent(username)}/${encodeURIComponent(folderPath)}`, {
       method: 'MKCOL',
       headers: {
@@ -86,7 +101,8 @@ async function ensureFolderStructure(nextcloudUrl: string, username: string, pas
     await createFolder(nextcloudUrl, username, password, 'Private/Health');
   } catch (error) {
     console.error('Error creating folder structure:', error);
-    throw error;
+    // Don't throw the error, just log it
+    // This way we don't trigger password regeneration
   }
 }
 
@@ -110,17 +126,13 @@ async function getWebDAVCredentials(nextcloudUrl: string, username: string, admi
       });
 
       if (verifyResponse.ok) {
-        try {
-          // Ensure required folders exist
-          await ensureFolderStructure(nextcloudUrl, username, credentials.password);
-          return credentials.password;
-        } catch (folderError) {
-          console.error('Failed to create folders with existing credentials:', folderError);
-          // If folder creation fails, we'll try with new credentials
-        }
+        // Try to create folders, but don't fail if it doesn't work
+        await ensureFolderStructure(nextcloudUrl, username, credentials.password);
+        return credentials.password;
       }
 
-      // If verification failed or folder creation failed, delete the old credentials
+      // Only delete credentials if verification actually failed
+      console.log('Credentials verification failed, deleting old credentials');
       await prisma.webDAVCredentials.delete({
         where: { userId },
       });
@@ -169,7 +181,7 @@ async function getWebDAVCredentials(nextcloudUrl: string, username: string, admi
       },
     });
 
-    // Create required folder structure
+    // Try to create folders, but don't fail if it doesn't work
     await ensureFolderStructure(nextcloudUrl, username, newPassword);
 
     return newPassword;