diff --git a/plugins/libplugin-pay.c b/plugins/libplugin-pay.c
index 852e35a4d..8f25bdce6 100644
--- a/plugins/libplugin-pay.c
+++ b/plugins/libplugin-pay.c
@@ -54,6 +54,7 @@ struct payment *payment_new(tal_t *ctx, struct command *cmd,
 		p->partid = 0;
 		p->next_partid = 1;
 		p->plugin = cmd->plugin;
+		p->channel_hints = tal_arr(p, struct channel_hint, 0);
 	}
 
 	/* Initialize all modifier data so we can point to the fields when
@@ -793,3 +794,61 @@ static inline void retry_step_cb(struct retry_mod_data *rd,
 
 	payment_continue(p);
 }
+
+static struct command_result *
+local_channel_hints_listpeers(struct command *cmd, const char *buffer,
+			      const jsmntok_t *toks, struct payment *p)
+{
+	const jsmntok_t *peers, *peer, *channels, *channel, *spendsats, *scid, *dir, *connected;
+	size_t i, j;
+	peers = json_get_member(buffer, toks, "peers");
+
+	if (peers == NULL)
+		goto done;
+        /* cppcheck-suppress uninitvar - cppcheck can't undestand these macros. */
+	json_for_each_arr(i, peer, peers) {
+		channels = json_get_member(buffer, peer, "channels");
+		if (channels == NULL)
+			continue;
+
+		connected = json_get_member(buffer, peer, "connected");
+
+		json_for_each_arr(j, channel, channels) {
+			struct channel_hint h;
+			spendsats = json_get_member(buffer, channel, "spendable_msat");
+			scid = json_get_member(buffer, channel, "short_channel_id");
+			dir = json_get_member(buffer, channel, "direction");
+			assert(spendsats != NULL && scid != NULL && dir != NULL);
+
+			json_to_bool(buffer, connected, &h.enabled);
+			json_to_short_channel_id(buffer, scid, &h.scid.scid);
+			json_to_int(buffer, dir, &h.scid.dir);
+
+			json_to_msat(buffer, spendsats, &h.estimated_capacity);
+			tal_arr_expand(&p->channel_hints, h);
+		}
+	}
+
+done:
+	payment_continue(p);
+	return command_still_pending(cmd);
+}
+
+static void local_channel_hints_cb(void *d UNUSED, struct payment *p)
+{
+	struct out_req *req;
+	/* If we are not the root we don't look up the channel balances since
+	 * it is unlikely that the capacities have changed much since the root
+	 * payment looked at them. We also only call `listpeers` when the
+	 * payment is in state PAYMENT_STEP_INITIALIZED, right before calling
+	 * `getroute`. */
+	if (p->parent != NULL || p->step != PAYMENT_STEP_INITIALIZED)
+		return payment_continue(p);
+
+	req = jsonrpc_request_start(p->plugin, NULL, "listpeers",
+				    local_channel_hints_listpeers,
+				    local_channel_hints_listpeers, p);
+	send_outreq(p->plugin, req);
+}
+
+REGISTER_PAYMENT_MODIFIER(local_channel_hints, void *, NULL, local_channel_hints_cb);
diff --git a/plugins/libplugin-pay.h b/plugins/libplugin-pay.h
index f175d7988..a52505863 100644
--- a/plugins/libplugin-pay.h
+++ b/plugins/libplugin-pay.h
@@ -66,8 +66,20 @@ struct payment_result {
 	struct preimage *payment_preimage;
 };
 
-/* Relevant information about a local channel so we can  exclude them early. */
-struct channel_status {
+/* Information about channels we inferred from a) looking at our channels, and
+ * b) from failures encountered during attempts to perform a payment. These
+ * are attached to the root payment, since that information is
+ * global. Attempts update the estimated channel capacities when starting, and
+ * get remove on failure. Success keeps the capacities, since the capacities
+ * changed due to the successful HTLCs. */
+struct channel_hint {
+	struct short_channel_id_dir scid;
+
+	/* Upper bound on remove channels inferred from payment failures. */
+	struct amount_msat estimated_capacity;
+
+	/* Is the channel enabled? */
+	bool enabled;
 };
 
 /* Each payment goes through a number of steps that are always processed in
@@ -168,6 +180,10 @@ struct payment {
 
 	struct bolt11 *invoice;
 
+	/* tal_arr of channel_hints we incrementally learn while performing
+	 * payment attempts. */
+	struct channel_hint *channel_hints;
+
 	struct payment_result *result;
 };
 
@@ -210,6 +226,12 @@ struct retry_mod_data {
 extern struct payment_modifier dummy_pay_mod;
 REGISTER_PAYMENT_MODIFIER_HEADER(retry, struct retry_mod_data);
 
+/* For the root payment we can seed the channel_hints with the result from
+ * `listpeers`, hence avoid channels that we know have insufficient capacity
+ * or are disabled. We do this only for the root payment, to minimize the
+ * overhead. */
+REGISTER_PAYMENT_MODIFIER_HEADER(local_channel_hints, void);
+
 struct payment *payment_new(tal_t *ctx, struct command *cmd,
 			    struct payment *parent,
 			    struct payment_modifier **mods);
diff --git a/plugins/pay.c b/plugins/pay.c
index f8fbf83e8..dc37ac143 100644
--- a/plugins/pay.c
+++ b/plugins/pay.c
@@ -1708,8 +1708,9 @@ static void init(struct plugin *p,
 	maxdelay_default = atoi(field);
 }
 
-struct payment_modifier *paymod_mods[3] = {
+struct payment_modifier *paymod_mods[4] = {
 	&dummy_pay_mod,
+	&local_channel_hints_pay_mod,
 	&retry_pay_mod,
 	NULL,
 };