Limited enforceability of credit contracts affects inequality and economic growth. In a neoclassical growth model, agents with different wealth, ability, and patience can borrow and lend but face enforcement constraints, leading to capital misallocation. If agents have equal patience, capital misallocation disappears in the long run. However, if discount rates differ, misallocation persists. Poor creditor rights worsen wealth inequality due to wealth accumulation compensating for enforcement constraints. Additionally, interest rates are lower in economies with enforcement constraints.