Why am I getting mental images of my past?

Hello doctor,

I have been suffering from what I think are mental problems since last year. To give you some context, I went abroad for studies, and I felt extremely lonely and miserable there. After a year, I was suffering from sleep problems. However, one day, I had confusing thoughts, just before I went to sleep. For some reason, I became convinced that I had a mental illness, and I began researching my symptoms. My condition also declined. I began to feel detached from everyone and everything around me, and I felt like I was losing touch with reality. This went on for some months. However, during this time, I felt fine when I was in the company of others, and therefore longed to be with people and talk to them.I gave my exams, even rejoined a job, which I had left to do my masters. There are periods when I feel completely fine. But, there are periods when I feel terrible. I am having the following symptoms. Whatever dreams I have, I tend to remember and notice them more. I could be dreaming about my old house or someone. So when I wake up, these dreams cause me to feel uncomfortable, like maybe I will lose my grip on reality. Whenever I see or meet a person I have dreamt about, I get an uncomfortable, unpleasant feeling and a memory of the dream. This makes me afraid that maybe I will be unable to distinguish between dreams and reality.

I get mental images and thoughts of memories or things I dreamt about. This gives a very unpleasant feeling. For the past few days, I am getting strong mental images of faces of people whenever I talk to them or think about them or see them. For instance, I would be thinking of someone, and I will have a strong mental image of their face. I would be talking to someone, and a different mental image of their face would pop up. I am really scared about this. Why am I getting mental images of everything like this? I feel depressed and sad that I will lose control, and that I will go crazy. At times, I am confused and not able to process things properly. I have also started feeling scared and petrified for no reason. I get a sinking and nervous feeling in my chest. My hands shake at times, and I feel like I will lose control. This has been happening for the past 10 months. Are my worst fears true? Do I have a mental illness?

Thank you doctor,

To clarify, I do not actually see things that are not there. I just have mental images in my mind. I know this is a product of my imagination. Would it still be psychosis? Or can it just be anxiety or depression?