diff --git a/README b/README
index 9565263..039021e 100644
--- a/README
+++ b/README
@@ -31,6 +31,7 @@ DEPENDENCIES
 
 To use git-crypt, you need:
 
+	* Git 1.6.0 or later
 	* OpenSSL
 	* For decrypted git diff output, Git 1.6.1 or later
 	* For decrypted git blame output, Git 1.7.2 or later
diff --git a/commands.cpp b/commands.cpp
index fcd5851..2fd6df2 100644
--- a/commands.cpp
+++ b/commands.cpp
@@ -195,10 +195,13 @@ void init (const char* argv0, const char* keyfile)
 	// 0. Check to see if HEAD exists.  See below why we do this.
 	bool		head_exists = system("git rev-parse HEAD >/dev/null 2>/dev/null") == 0;
 
-	// 1. Make sure working directory is clean
+	// 1. Make sure working directory is clean (ignoring untracked files)
+	// We do this because we run 'git reset --hard HEAD' later and we don't
+	// want the user to lose any changes.  'git reset' doesn't touch
+	// untracked files so it's safe to ignore those.
 	int		status;
 	std::string	status_output;
-	status = exec_command("git status --porcelain", status_output);
+	status = exec_command("git status -uno --porcelain", status_output);
 	if (status != 0) {
 		std::clog << "git status failed - is this a git repository?\n";
 		std::exit(1);