Over the years I have frequently thought about the relationship between the uncompromising ethical stance of much of the New Testament (not least the Sermon on the Mount), and salvation as the free gift of God, through the cross, while we were still God's enemies.
With the help of various theologians (John Calvin, Karl Barth etc), as well as sustained reflection on the Bible (not just the New Testament) I have come to think of it in terms of a response. We are given a free gift of live, salvation through Jesus Christ, which we must live out. We must live a life worthy of the calling we have received.
But of course the context of that life is always that it is a free gift. We didn't earn it in the first place, and we can't mess up so badly that there is no way back. We can't lose our salvation in Christ through our failure to live it out. There is nothing we can do that is so bad God won't forgive us—if we repent.
And right there is the crux of the issue. We can stuff things up terribly, but if we repent and turn back to God, he will forgive us our sin and cleanse us from all unrighteousness. Although our sin cuts us off from God, there is always a way back, through the cross, if we repent.
Unrepentance I think comes in two guises: first, refusing to repent of what we know is sinful behaviour (this is the most obvious kind); second (more subtly perhaps), failing to acknowledge that we are simul iustus et peccatore, at once justified and sinner, and that we do mess things up.
The first is perhaps more common in our individual lives, the second much more common in our communities. In many (evangelical) churches I have been privileged to be a part of, there has been an unspoken culture / expectation that actually things are all right for everyone. Maybe that's my perception, I don't know, but that's how I've felt.
When the culture is like that, it is very difficult for individuals to acknowledge serious failures. Yeah we can all say a confession, I haven't put God first, that kind of stuff, but when there is a serious problem, the sense of failure is so strong that it is difficult to tell anyone, because you are worried they will judge you for not being a good enough Christian (or whatever).
I'm sure I'm not alone in thinking that. Often in churches it can feel as if we are expected to be perfect, so when things aren't it is very difficult to talk to anyone about it. Somehow we need to create an atmosphere in which failure (privately and publicly), while not accepted as 'right', is not condemned or judged, but accepted as 'real' and worked through, drawing on God's grace and power.
We need to create communities of grace (I'm sure I've not made that phrase up, but I don't know where it's come from), which accept sinners, but challenge sin and encourage an atmosphere of repentance and forgiveness.
We need not to expect people to be perfect, or even close, but to be real about the messed-up world we live in, that things don't always work out, that people get things wrong, that we all do, just some of us more obviously than others. People need to be aware of all that, so they feel comfortable and able to be real and honest, to share where they are really at, so that sin can be dealt with in God's way (by repentance and forgiveness) rather than being allowed to fester within our congregations.