Yes, you are supposed to list what the card is worth Raw in that condition. If, in the case you send in a Mantle under a $1999 service level and it scores a grade making it worth $8K, they may contact you and let you know they're upgrading the service level to help pay for return shipping. And you will say "Thank you kindly, ma'am."
I've heard of them doing it to a guy who sent in an 87 Fleer Jordan which scored a 10.
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PWCC: The Fish Stinks From the Head
PSA: Regularly Get Cheated
BGS: Can't detect trimming on modern
SGC: Closed auto authentication business
JSA: Approved same T206 Autos before SGC
Oh, what a difference a year makes.
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