“The New Testament word charis, from chairein, “to rejoice,” denotes first of all a pleasant external appearance, “loveliness,” “agreeableness,” “acceptableness,” and has some such meaning in Luke 4:22; Colossians 4:6. A more prominent meaning of the word, however, is favour or good-will, Luke 1:30; 2:40, 52; Acts 2:47; 7:46; 24:27; 25:9. It may denote the kindness or beneficence of our Lord, II Corinthians 8:9, or the favour manifested or bestowed by God, II Corinthians 9:8 (referring to material blessings); I Peter 5:10. Furthermore, the word is expressive of the emotion awakened in the heart of the recipient of such favour, and thus acquires the meaning “gratitude” or “thankfulness,” Luke 4:22; I Corinthians 10:30; 15:57; II Corinthians 2:14; 8:16; I Timothy 1:12. In most of the passages, however, in which the word charis is used in the New Testament, it signifies the unmerited operation of God in the heart of man, effected through the agency of the Holy Spirit. While we sometimes speak of grace as an inherent quality, it is in reality the active communication of divine blessings by the in working of the Holy Spirit, out of the fulness of Him who is “full of grace and truth,” Romans 3:24; 5:2, 15, 17, 20; 6:1; I Corinthians 1:4; II Corinthians 6:1; 8:9; Ephesians 1:7; 2:5, 8; 3:7; I Peter 3:7; 5:12.”
2. The grace of God in the work of redemption. A discussion of the grace of God in connection with the work of redemption again calls for several distinctions, which should be borne in mind.
a. In the first place grace is an attribute of God, one of the divine perfections. It is God’s free, sovereign, undeserved favour or love to man, in his state of sin and guilt, which manifests itself in the forgiveness of sin and deliverance from its penalty. It is connected with the mercy of God as distinguished from His justice. This is redemptive grace in the most fundamental sense of the word. It is the ultimate cause of God’s elective purpose, of the sinner’s justification, and of his spiritual renewal; and the prolific source of all spiritual and eternal blessings.
b. In the second place the term “grace” is used as a designation of the objective provision which God made in Christ for the salvation of man. Christ as the Mediator is the living embodiment of the grace of God. “The Word became flesh, and dwelt among us ... full of grace and truth,” John 1:14. Paul has the appearance of Christ in mind, when he says: “For the grace of God hath appeared, bringing salvation to all men,” Titus 2:11. But the term is applied not only to what Christ is, but also to what He merited for sinners. When the apostle speaks repeatedly in the closing salutations of his Epistles of “the grace of our Lord Jesus Christ,” he has in mind the grace of which Christ is the meritorious cause. John says: “The law was given through Moses, but grace and truth came through Jesus Christ,” John 1:17. Cf. also Ephesians 2:7.
c. In the third place the word “grace” is used to designate the favor of God as it is manifested in the application of the work of redemption by the Holy Spirit. It is applied to the pardon which we receive in justification, a pardon freely given by God, Romans 3:24; 5:2, 21; Titus 3:15. But in addition to that it is also a comprehensive name for all the gifts of the grace of God, the blessings of salvation, and the spiritual graces which are wrought in the hearts and lives of believers through the operation of the Holy Spirit, Acts 11:23; 18:27; Romans 5:17; I Corinthians 15:10; II Corinthians 9:14; Ephesians 4:7; James 4:5, 6; I Peter 3:7. Moreover, there are clear indications of the fact that it is not a mere passive quality, but also an active force, a power, something that labors, I Corinthians 15:10; II Corinthiand 12:9; II Timothy 2:1. In this sense of the word it is something like a synonym for the Holy Spirit, so that there is little difference between “full of the Holy Spirit” and “full of grace and power” in Acts 6:5 and 8. The Holy Spirit is called “the Spirit of grace” in Hebrews 10:29. It is especially in connection with the teachings of Scripture respecting the application of the “connection with the teachings of Scripture respecting the application of the grace of God to the sinner by the Holy Spirit, that the doctrine of grace was developed in the Church.”
Excerpt From: Louis Berkhof. “Systematic Theology.” iBooks.