I upgraded from 1 GB to 2 GB box and backups seem to be working now.
total used free shared buff/cache available
Mem: 2.0G 1.2G 276M 141M 544M 498M
Swap: 2.0G 28M 2.0G
If anyone else has this problem, I’d try a reboot first because the Ubuntu box had also recently had kernel upgrades, so maybe that was the issue.