diff --git a/IPython/core/application.py b/IPython/core/application.py
index cf26a31..918211b 100644
--- a/IPython/core/application.py
+++ b/IPython/core/application.py
@@ -25,7 +25,7 @@ from IPython.core import release, crashhandler
 from IPython.core.profiledir import ProfileDir, ProfileDirError
 from IPython.utils.path import get_ipython_dir, get_ipython_package_dir, ensure_dir_exists
 from IPython.utils import py3compat
-from IPython.utils.traitlets import List, Unicode, Type, Bool, Dict, Set, Instance
+from IPython.utils.traitlets import List, Unicode, Type, Bool, Dict, Set, Instance, Undefined
 
 if os.name == 'nt':
     programdata = os.environ.get('PROGRAMDATA', None)
@@ -215,7 +215,7 @@ class BaseIPythonApplication(Application):
             return crashhandler.crash_handler_lite(etype, evalue, tb)
     
     def _ipython_dir_changed(self, name, old, new):
-        if old is not None:
+        if old is not None and old is not Undefined:
             str_old = py3compat.cast_bytes_py2(os.path.abspath(old),
                 sys.getfilesystemencoding()
             )
diff --git a/IPython/utils/traitlets.py b/IPython/utils/traitlets.py
index cf9016f..e1a0ca2 100644
--- a/IPython/utils/traitlets.py
+++ b/IPython/utils/traitlets.py
@@ -622,6 +622,8 @@ class HasTraits(py3compat.with_metaclass(MetaHasTraits, object)):
                     for name in cache:
                         if cache[name][1] is not Undefined:
                             setattr(self, name, cache[name][1])
+                        else:
+                            delattr(self, name)
                     notifications = {}
                     raise e
                 finally:
@@ -633,10 +635,9 @@ class HasTraits(py3compat.with_metaclass(MetaHasTraits, object)):
                         # remove the redundant value from __dict__
                         # (only used to preserve pickleability on Python < 3.4)
                         self.__dict__.pop('_notify_trait', None)
-
                     # trigger delayed notifications
-                    for name in notifications:
-                        self._notify_trait(*(notifications[name]))
+                    for v in dict(cache, **notifications).values():
+                        self._notify_trait(*v)
 
     def _notify_trait(self, name, old_value, new_value):