Quote: Vampire: The Masquerade - Bloodlines
Hell yeah! This game is an underappreciated gem! And while it isn't exactly survival horror, it has some very scary levels and a great atmosphere overall. Ocean House Hotel regularly appears on all sorts of rankings of "scariest levels ever"... O.O
It also has some of the funniest dialogue I ever encountered in a game and it's only 15€ on Steam. So go pick it up
I can also recommend:
Condemned: Criminal Origins
(Maybe the best first person melee combat ever, some VERY scary levels, just enough supernatural elements to be intriguing but not so many that it would feel clichée.)
The Void
(Very surreal game. Not exactly horror but very dark and scary in an almost subliminal way. Gameplay is rather experimental and quite difficult at times but definitely interesting, with a strong focus on exploration. It's only 2,24€ on Steam right now so there's no reason to not give it a try - if only for the novelty.)
Eternal Darkness: Sanity's Requiem
(Only available for Gamecube. An old but good horror game inspired by Lovecraft. Known for having a crazy insanity mechanic that regularly breaks the fourth wall.)
I Have No Mouth And I Must Scream:
(A very old Point and Click Adventure with an interesting storyline. Not available for purchase anymore as far as I know, but may or may not be found as abandonware somewhere. Worth a look I'd say, but will need DosBox or scummVM to run.)