to say you have hip impingement is just to say that your mobility is restricted. which you knew already lol.
there could be a bunch of reasons ranging from the shape of your bones (the ball shape of the head of the femur, the shape of the pelvic socket) to something to do with the cartilage to something to do with the ligaments to something to do with the muscles.
forget about squatting like you are supposed to squat with weights. what happens if you just gotta squat yourself down (unweighted). i mean... forget everything you have ever been told about how you are 'supposed' to squat... and just duck down there like a brick will hit you in the face if you don't.
then take a look. what is going on? are your heels on the ground or up in the air? what if you wiggle them to the ground? do you fall over backwards or what? do you have stabby pain in your hips? how is your ankle mobility etc...
i used to get stabby pain in my hips. felt to me like i'd imagine torn cartilage would feel. grippy kinda and painful. also felt like bone was jamming on bone... took me years to figure... but now... my hips are the best they have ever been. and i credit that to working out my squat.
a vid front on and side on of your trying to do it might help.