That happened on my dad's lawn boy (the 4 stroke I have talked about that he gave me). When I got it, he said he didn't even know it was self-propelled.
When I took it apart, the cable did exactly what you describe. Except, it was right where it was clamped to the handlebars on the side. Figure somebody overtightened it (or maybe the factory did).
Put a cable on it from a junk rally (was an engine brake cable....LOL), and it worked like a dream!