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I'm trying Capistrano to deploy to a VPS where I have public key access to my user foo. For deployment, I created another user deploy, set up my key into it's authorized_keys, configured capistrano to use this user and did a succesful cap deploy:setup. From then on, I couldn't log passwordless into deploy@vps anymore, with or without capistrano. My key works because ssh'ing into foo@vps works as always. I'm a little lost here..

I'm using keychain 2.7.1 for key management, if it helps.

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It turned out to be Yet Another Permission Problemâ„¢.

Jan 01 17:47:20 [sshd] Authentication refused: bad ownership or modes for directory /home/deploy

It had 720... changed it to 700 and it worked. I still don't know how it got changed (adduser created it with 700) but I suspect that capistrano did that somehow. So I'll accept the answer that explains that :)