I am taking out a loan for a friend. What can I do to protect myself and my credit.

One way to protect yourself is to take security interests in her assets (and make sure you record them properly with the appropriate government authority), so that if she defaults you will be able to sell her assets to get your money.  Another may be to have her purchase credit insurance, so that if she loses her job, dies, or suffers other financial setbacks, the insurance would cover your loan.  The price of this insurance may make it impractical.  Another is to get a confession of judgment as part of the loan transaction (this might be called something else in Texas) so that, if she defaults, you have the right to file the judgment and start enforcement proceedings, rather than having to first file a lawsuit and obtain a judgment.  She would still be able to challenge the confession of judgment on certain grounds, but the burden would be on her to start a lawsuit challenging the confession, rather than on you.  If you can get someone else with sound finances to guarantee her loan, that would give you additional protection.  If she is repaying in installments, make sure that the loan agreement provides that the entire amount becomes due and owing as soon as she misses one payment.  Otherwise you'd have to sue separately for each missed payment, and other creditors may get to her assets while you are waiting for a second payment to be missed.  The agreement should also provide that she will pay your attorneys' fees and court costs if she defaults and you have to go to court to enforce the loan agreement.  Also, rather than loaning her the money directly, you might be better off purchasing her loans from her lenders if you can, since they may have already done some of this (particularly, they may have already taken security interests which they can assign to you; the procedure for perfecting a security interest can be difficult for a layman, and there are some fees involved.)