There should be felt washers in the lower bearing, they are there to seal out dirt. You should have a small collar that goes between the bearing and the fan spacers and rides inside the felt washer.
I have a brand new lower bearing (mounted in a bearing plate) for a Hoover 700 and it has felt washers in it.
If it helps, I clean out the bearing with lighter fluid, make sure it's dry and then repack the bearing with grease.
