Hey there,
I completly get what you're going though. What you descirded is basicly my life right now, especially the part about the selective mutism. That was the first decent description of what social interacts are like for me. So thank you.
On the note of how to help. I dont' completly know, but one thing I did was think about why I was getting scared. I mean, I was having panic attacks around friends. So I relized that there were some people that I didn't feel that sort of anxiety, and now those are my close friends. It may be different for you, but I decided that my anxiety came from having to constently be "on". Meaning that I had to be thinking about what I was saying, or trying to fit in or not make a fool of myself.
In situations that are mandatory(like a person just walks up to you and starts a conversation) I still have trouble, but I would take a deep breath, and think about what I was going to say. And if absolutely nessisary I would politly excuse myself(say I had to leave, or go to the restroom). It can be akward, but I also found that not mataining constent eye contact helped. I don't mean look at the floor. I just mean focus on something by their face, but not intensely.
I hope that this has helped, or at least made you feel not as alone.
Please feel free to
PM me anytime.
Clover