I find it very difficult to be legitimately scared in a video game nowadays. I don't think jump scares or grotesque violence is scary, just annoying and stupid. I love horror that is unsettling, and stuff that has great atmosphere. Here are some games that were very effective in getting me scared.
Year Walk. Wow so perfectly unsettling.
Condemned: Criminal Origins. Specifically the whole mannequin sequence.
Fatal Frame 2: Crimson Butterfly
Dead Space. Not the second one.
Amnesia: The Dark Descent. I never finished it (because i had seen a lot of the game before i played it) and the part that stood out to me was the first water sequence.
One sequence in Resident Evil 4, when you encounter those tall spiky dudes that can regenerate their limbs. The sounds they make are super unsettling.
Here are some horror games that I loved, but weren't necessarily frightening.
Siren: Blood Curse. The story becomes so crazy and impossible to wrap your head around, it made me want to play through it twice to understand what was actually happening.
Silent Hill: Shattered Memories. Very good atmosphere, and great use of the wii remote. I never finished it because i came across a game breaking bug and I never saved the game, nor does it autosave.
Eternal Darkness: Sanity's Requiem. Super neat sanity effects, though they don't really work nowadays. There was one effect that did get me, where when I hit pause to save the game, it took control of the menu and began deleting my game. It was one of the most frightening moments in my gaming history xD
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