diff --git a/src/pylorax/api/projects.py b/src/pylorax/api/projects.py
index 4214059d..40171363 100644
--- a/src/pylorax/api/projects.py
+++ b/src/pylorax/api/projects.py
@@ -403,6 +403,10 @@ def source_to_repo(source):
 
     """
     repo = yum.yumRepo.YumRepository(source["name"])
+    # This will allow errors to be raised so we can catch them
+    # without this they are logged, but the repo is silently disabled
+    repo.skip_if_unavailable = False
+
     if source["type"] == "yum-baseurl":
         repo.baseurl = [source["url"]]
     elif source["type"] == "yum-metalink":
diff --git a/src/pylorax/api/v0.py b/src/pylorax/api/v0.py
index 4047ed58..56d850aa 100644
--- a/src/pylorax/api/v0.py
+++ b/src/pylorax/api/v0.py
@@ -1451,11 +1451,6 @@ def v0_api(api):
                 if source["name"] in repos:
                     yb.repos.delete(source["name"])
 
-                # XXX - BCL DIAGNOSTIC
-                repos = list(r.id for r in yb.repos.listEnabled())
-                if source["name"] in repos:
-                    return jsonify(status=False, errors=["Failed to delete Yum repo %s" % source["name"]]), 400
-
                 repo = source_to_repo(source)
                 yb.repos.add(repo)
 
@@ -1476,6 +1471,18 @@ def v0_api(api):
             with open(source_path, "w") as f:
                 f.write(str(repo))
         except Exception as e:
+            log.error("(v0_projects_source_add) adding %s failed: %s", source["name"], str(e))
+
+            # Cleanup the mess, if loading it failed we don't want to leave it in memory
+            with api.config["YUMLOCK"].lock:
+                repos = list(r.id for r in yb.repos.listEnabled())
+                if source["name"] in repos:
+                    yb = api.config["YUMLOCK"].yb
+                    yb.repos.delete(source["name"])
+
+                    log.info("Updating repository metadata after adding %s failed", source["name"])
+                    update_metadata(yb)
+
             return jsonify(status=False, errors=[str(e)]), 400
 
         return jsonify(status=True)
diff --git a/tests/pylorax/test_server.py b/tests/pylorax/test_server.py
index 8ea14c89..24bb1dea 100644
--- a/tests/pylorax/test_server.py
+++ b/tests/pylorax/test_server.py
@@ -542,6 +542,16 @@ class ServerTestCase(unittest.TestCase):
         self.assertEqual(repo["check_ssl"], False)
         self.assertTrue("gpgkey_urls" not in repo)
 
+    def test_projects_source_00_bad_url(self):
+        """Test /api/v0/projects/source/new with a new source that has an invalid url"""
+        toml_source = open("./tests/pylorax/source/bad-repo.toml").read()
+        self.assertTrue(len(toml_source) > 0)
+        resp = self.server.post("/api/v0/projects/source/new",
+                                data=toml_source,
+                                content_type="text/x-toml")
+        data = json.loads(resp.data)
+        self.assertEqual(data["status"], False)
+
     def test_projects_source_01_delete_system(self):
         """Test /api/v0/projects/source/delete a system source"""
         resp = self.server.delete("/api/v0/projects/source/delete/base")
diff --git a/tests/pylorax/test_yumbase.py b/tests/pylorax/test_yumbase.py
index b0569028..54d0f969 100644
--- a/tests/pylorax/test_yumbase.py
+++ b/tests/pylorax/test_yumbase.py
@@ -83,6 +83,5 @@ class CreateYumDirsTest(unittest.TestCase):
 
         # will create the above directory if missing
         make_yum_dirs(config)
-        _ = get_base_object(config)
 
         self.assertTrue(os.path.exists(self.tmp_dir + '/var/tmp/composer/yum/root'))