diff --git a/lua/avante/llm.lua b/lua/avante/llm.lua
index e24aced..ef6a637 100644
--- a/lua/avante/llm.lua
+++ b/lua/avante/llm.lua
@@ -936,44 +936,45 @@ function M._stream(opts)
         return handle_next_tool_use(pending_tools, pending_tool_use_messages, 1, {}, stop_opts.streaming_tool_use)
       end
       if stop_opts.reason == "rate_limit" then
-        local msg_content = "*[Rate limit reached. Retrying in " .. stop_opts.retry_after .. " seconds ...]*"
-        if opts.on_chunk then opts.on_chunk("\n" .. msg_content .. "\n") end
-        local message
-        if opts.on_messages_add then
-          message = History.Message:new({
+        local message = opts.on_messages_add
+          and History.Message:new({
             role = "assistant",
-            content = "\n\n" .. msg_content,
+            content = "", -- Actual content will be set below
           }, {
             just_for_display = true,
           })
-          opts.on_messages_add({ message })
-        end
+
         local timer = vim.loop.new_timer()
         if timer then
-          local retry_after = stop_opts.retry_after
+          local retry_count = stop_opts.retry_after
+          Utils.info("Rate limit reached. Retrying in " .. retry_count .. " seconds", { title = "Avante" })
+
           local function countdown()
-            timer:start(
-              1000,
-              0,
-              vim.schedule_wrap(function()
-                if retry_after > 0 then retry_after = retry_after - 1 end
-                local msg_content_ = "*[Rate limit reached. Retrying in " .. retry_after .. " seconds ...]*"
-                if opts.on_chunk then opts.on_chunk([[\033[1A\033[K]] .. "\n" .. msg_content_ .. "\n") end
-                if opts.on_messages_add and message then
-                  message.message.content = "\n\n" .. msg_content_
-                  opts.on_messages_add({ message })
-                end
-                countdown()
-              end)
-            )
+            local msg_content = "*[Rate limit reached. Retrying in " .. retry_count .. " seconds ...]*"
+            if opts.on_chunk then
+              -- Use ANSI escape codes to clear line and move cursor up only for subsequent updates
+              local prefix = ""
+              if retry_count < stop_opts.retry_after then prefix = [[\033[1A\033[K]] end
+              opts.on_chunk(prefix .. "\n" .. msg_content .. "\n")
+            end
+            if opts.on_messages_add and message then
+              message.message.content = "\n\n" .. msg_content
+              opts.on_messages_add({ message })
+            end
+
+            if retry_count <= 0 then
+              timer:stop()
+              timer:close()
+
+              Utils.info("Restarting stream after rate limi pause")
+              M._stream(opts)
+            else
+              retry_count = retry_count - 1
+            end
           end
-          countdown()
+
+          timer:start(0, 1000, vim.schedule_wrap(function() countdown() end))
         end
-        Utils.info("Rate limit reached. Retrying in " .. stop_opts.retry_after .. " seconds", { title = "Avante" })
-        vim.defer_fn(function()
-          if timer then timer:stop() end
-          M._stream(opts)
-        end, stop_opts.retry_after * 1000)
         return
       end
       return opts.on_stop(stop_opts)