--- pppd/auth.c
+++ pppd/auth.c
@@ -555,6 +555,7 @@ void start_link(unit)
 {
     char *msg;
 
+    status = EXIT_NEGOTIATION_FAILED;
     new_phase(PHASE_SERIALCONN);
 
     hungup = 0;
@@ -591,7 +592,6 @@ void start_link(unit)
 	notice("Starting negotiation on %s", ppp_devnam);
     add_fd(fd_ppp);
 
-    status = EXIT_NEGOTIATION_FAILED;
     new_phase(PHASE_ESTABLISH);
 
     lcp_lowerup(0);