diff --git a/lib/document.js b/lib/document.js
index 72c12c75442..e6f73aeb774 100644
--- a/lib/document.js
+++ b/lib/document.js
@@ -1149,8 +1149,8 @@ Document.prototype.$set = function $set(path, val, type, options) {
       }
 
       if (utils.isNonBuiltinObject(valForKey) && pathtype === 'nested') {
-        $applyDefaultsToNested(path[key], prefix + key, this);
         this.$set(prefix + key, path[key], constructing, Object.assign({}, options, { _skipMarkModified: true }));
+        $applyDefaultsToNested(this.$get(prefix + key), prefix + key, this);
         continue;
       } else if (strict) {
         // Don't overwrite defaults with undefined keys (gh-3981) (gh-9039)
diff --git a/test/document.test.js b/test/document.test.js
index 160b14fbe3d..359a0ee050d 100644
--- a/test/document.test.js
+++ b/test/document.test.js
@@ -8831,7 +8831,7 @@ describe('document', function() {
     assert.ok(!user.updatedAt);
   });
 
-  it('Sets default when passing undefined as value for a key in a nested subdoc (gh-9039)', async function() {
+  it('Sets default when passing undefined as value for a key in a nested subdoc (gh-12102) (gh-9039)', async function() {
     const Test = db.model('Test', {
       nested: {
         prop: {
@@ -8841,9 +8841,11 @@ describe('document', function() {
       }
     });
 
-
-    const doc = await Test.create({ nested: { prop: undefined } });
+    const obj = { nested: { prop: undefined } };
+    const doc = await Test.create(obj);
     assert.equal(doc.nested.prop, 'some default value');
+
+    assert.deepStrictEqual(obj, { nested: { prop: undefined } });
   });
 
   it('allows accessing $locals when initializing (gh-9098)', function() {