Hello,
just completed a DMP about a year ago. They did indeed require that I close out all my accounts. However, because of my DMP agreement, all my accounts started reporting that my acocunt was in good standing, and because of the lower interest rate, I was able to pay down the cards considerably faster than I would have done on my own.
While the DMP, my scores were in the low 500's. At the end of the DMP (last August) I was at 590. In January I applied for (and received) a card with a $3000 credit line. I just took a trip to Italy, and since the card was in a 0% interest promotional period, and since it charged no international transaction fees, I prettmy much maxed otu the card. On Friday I decided to check my TU score. It's at 690. I just paid off the balance, and I'm hoping to see my score up in the mid 700's.
A DMP can be great if you're willing to be disciplined. My wife and I had to be very frugal for a few years, despite a decent income. We ate ramen and mac and cheese, which is very different than the behavior that got us into $45k of debt. Now we're living comfortably, have savings, and (with a brief 1 month exception for our trip) have remained CC debt free for almost a year. It feels great to live within your means once you get out from under the weight of credit cards.
