diff --git a/doc/Changelog b/doc/Changelog
index 100ffc612..a3b05b49a 100644
--- a/doc/Changelog
+++ b/doc/Changelog
@@ -1,6 +1,10 @@
 4 March 2015: Wouter
 	- Patch from Brad Smith that syncs compat/getentropy_linux with
 	  OpenBSD's version (2015-03-04).
+	- 0x20 fallback improved, better handling of servfail responses,
+	  they do not count as missing comparisons (except if all are failed),
+	  and better handling of inability to find nameservers, no more
+	  nameservers can be found results in fallback acceptance.
 
 3 March 2015: Wouter
 	- tag 1.5.3rc1
diff --git a/iterator/iter_utils.c b/iterator/iter_utils.c
index 10ae12f75..8c90653c0 100644
--- a/iterator/iter_utils.c
+++ b/iterator/iter_utils.c
@@ -750,6 +750,12 @@ caps_strip_reply(struct reply_info* rep)
 	}
 }
 
+int caps_failed_rcode(struct reply_info* rep)
+{
+	return !(FLAGS_GET_RCODE(rep->flags) == LDNS_RCODE_NOERROR ||
+		FLAGS_GET_RCODE(rep->flags) == LDNS_RCODE_NXDOMAIN);
+}
+
 void 
 iter_store_parentside_rrset(struct module_env* env, 
 	struct ub_packed_rrset_key* rrset)
diff --git a/iterator/iter_utils.h b/iterator/iter_utils.h
index 9373487e0..3a4df3e45 100644
--- a/iterator/iter_utils.h
+++ b/iterator/iter_utils.h
@@ -231,6 +231,14 @@ int reply_equal(struct reply_info* p, struct reply_info* q, struct regional* reg
  */
 void caps_strip_reply(struct reply_info* rep);
 
+/**
+ * see if reply has a 'useful' rcode for capsforid comparison, so
+ * not SERVFAIL or REFUSED, and thus NOERROR or NXDOMAIN.
+ * @param rep: reply to check.
+ * @return true if the rcode is a bad type of message.
+ */
+int caps_failed_rcode(struct reply_info* rep);
+
 /**
  * Store parent-side rrset in seperate rrset cache entries for later 
  * last-resort * lookups in case the child-side versions of this information 
diff --git a/iterator/iterator.c b/iterator/iterator.c
index 2037cc881..cd7e5b36b 100644
--- a/iterator/iterator.c
+++ b/iterator/iterator.c
@@ -1866,6 +1866,23 @@ processQueryTargets(struct module_qstate* qstate, struct iter_qstate* iq,
 			/* Since a target query might have been made, we 
 			 * need to check again. */
 			if(iq->num_target_queries == 0) {
+				/* if in capsforid fallback, instead of last
+				 * resort, we agree with the current reply
+				 * we have (if any) (our count of addrs bad)*/
+				if(iq->caps_fallback && iq->caps_reply) {
+					/* we're done, process the response */
+					verbose(VERB_ALGO, "0x20 fallback had %d responses, "
+						"but no more servers except "
+						"last resort, done.", 
+						(int)iq->caps_server+1);
+					iq->caps_fallback = 0;
+					iter_dec_attempts(iq->dp, 3); /* space for fallback */
+					iq->num_current_queries++; /* RespState decrements it*/
+					iq->referral_count++; /* make sure we don't loop */
+					iq->sent_count = 0;
+					iq->state = QUERY_RESP_STATE;
+					return 1;
+				}
 				return processLastResort(qstate, iq, ie, id);
 			}
 		}
@@ -2900,6 +2917,20 @@ process_response(struct module_qstate* qstate, struct iter_qstate* iq,
 				iq->caps_reply = iq->response->rep;
 				iq->caps_server = -1; /*become zero at ++,
 				so that we start the full set of trials */
+			} else if(caps_failed_rcode(iq->caps_reply) &&
+				!caps_failed_rcode(iq->response->rep)) {
+				/* prefer to upgrade to non-SERVFAIL */
+				iq->caps_reply = iq->response->rep;
+			} else if(!caps_failed_rcode(iq->caps_reply) &&
+				caps_failed_rcode(iq->response->rep)) {
+				/* if we have non-SERVFAIL as answer then 
+				 * we can ignore SERVFAILs for the equality
+				 * comparison */
+				/* no instructions here, skip other else */
+			} else if(caps_failed_rcode(iq->caps_reply) &&
+				caps_failed_rcode(iq->response->rep)) {
+				/* failure is same as other failure in fallbk*/
+				/* no instructions here, skip other else */
 			} else if(!reply_equal(iq->response->rep, iq->caps_reply,
 				qstate->env->scratch)) {
 				verbose(VERB_DETAIL, "Capsforid fallback: "