Door handle latch rod too long

I'm totally loosing my mind over this. I put on new door handles and the latch rod is inexplicably about 1/2" too long. I can push it up to connect it but then the flapper at the handle is pushed away so the button can't reach it. I took it apart again and used the old hardware that connects to the spring/button.
I searched online and somebody had the exact problem 10 years ago but never bothered to follow up if they resolved it.
I can remove the rod and shorten it but there has to be a more logical solution. The rod is NOT adjustable, no threads just a 90 on both ends.
The only thing that could adjust is where you connect to the latch but it doesn't seem to budge downward, the direction it needs to go.
 
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