Forgiveness of sin, righteousness, and eternal life aren't handed out by God because we deserve it.
What if we woke up tomorrow and discovered we could perfectly obey all God's commands? We could love God and love our neighbor. Would it do us any good in relation to God's way of doing things? No, perfectly obeying the Ten Commandments wouldn't do us any good because God's in the business of justifying sinners, and not by works of the Law. We could obey God's Law in full before or after we're declared justified for Jesus' sake, but it wouldn't do us any good. God doesn't advertise His grace and forgiveness to us as commodities that we can purchase for the right price. If He did that we wouldn't have any need for the grace and forgiveness that is imputed to us on account of Jesus' suffering and death. Christ Jesus would be useless to us if God's grace and forgiveness depended on our doing.
Where we get in trouble with this is when we imagine we're not so bad that we need a Savior to shed His blood and die for our sin. When we treat sin as not-so-horrible, as a character flaw, or a bad habit, or a moral failure, then we end up categorizing sins from 'sins that kill us' to 'not-so-bad sins.' It's a short walk from this to placing a value on our doing for God, working to obey the commandments in order to earn His favor. We end up trying to impress God by holding up and making a big deal of our sin.
This gets us into all sorts of trouble because God sent His only begotten Son into the world so that we may live through His doing. Jesus was crucified and died for us. By sacrificing Himself, God revealed to us that He gives us forgiveness of sin, righteousness, and eternal life as free gift on account of Jesus.
Forgiveness of sin, righteousness, and eternal life aren't handed out by God because we deserve it. Instead, Jesus' Good Friday sacrifice revealed that we can't love God with our whole heart and we can't love our neighbor as ourselves. We don't deserve grace and forgiveness. God is never satisfied with how we obey His Law. We're pointed only to Jesus' doing for us what is impossible for us to do, which is to perfectly obey God's Ten Commandments in order to be justified by them.
Not even the faith, which St. Paul says is "the fulfillment of the Law," is homegrown in our hearts. Faith which clings to Christ alone for our salvation is a gift delivered to us by God through His Spirit in the Gospel. This is how God counts us as righteous.
We also get in trouble when we treat the Ten Commandments like a do-it-yourself salvation project. We ignore what the Law teaches us about ourselves that: “All have sinned, and come short of the glory of God.” And, “there is no one that does good, no, not one.” And, “against You, You only, have I sinned.”
The Law humbles us, repents us, and shows us the truth about ourselves. We are shown that we're worse than we imagined, that we are all "sold under sin." God's Law makes us ask, "Who will help me?" When that question is forced out of us then we're ready for the Gospel, then we're ready to hear that there's no way for us to help ourselves, or expect help from God, outside of Christ crucified for us.
Jesus isn't a Judge or Executioner. He's the Lamb of God whose blood was shed for the sin of the world. Not a single sin is held against us by God for Christ's sake.
Jesus' blood covers all sin. This is why we receive grace and forgiveness from God, why we're declared righteous, why we're Christians. It's why Martin Luther said during his Galatians lectures in 1535:
A Christian is not somebody who has no sin, but somebody against whom God no longer chalks up sin, because of his faith in Christ. This doctrine brings comfort to consciences in serious trouble. When a person is a Christian he is above law and sin. When the Law accuses him, and sin wants to drive the wits out of him, a Christian looks to Christ. A Christian is free. He has no master except Christ. A Christian is greater than the whole world.
