"It does not apply to us" would be the response of many reformers. There are a number of ways the reformers or the Lutheran faith-alone believers may respond to the work-based teachings of Christ. Martin Luther argued to answer his critics that faith-alone [justification] includes works as inevitable consequent however he could not reconcile with epistle of James, thus rejected it altogether.
Followers after Luther began to somehow find more common grounds or harmony between faith and works teachings. Majority of reformers believe works are optional, not essential for salvation. A major factor in explaining such work based teachings is the underlying assumption of total depravity, that the law is impossible to be fully kept by man.
Then there are [many] Baptists who believe Christ's teachings in Gospels, James and Hebrews do not apply to Christians of new covenant, since the Church is created by Paul, and only his teachings apply to us today. Christ's teachings were of the old covenant and applied only to the Jews. People began to introduce vicarious-obedience theory; implying that Christ fulfilled the law or commandments on our behalf, we need not do anything. To explain away the teachings of Paul regarding everyone is to be judged according to his deeds (Gal 6:2-9 ; 2Cor 13:5-6; 5:10; 1Cor 7:19. Rom 2:6-14; 14:12; Phil 2:12) to be implying a different insignificant judgment of believers on their works which does not affect justification or salvation, it only affects believers' crown or heavenly rewards. It is called Bema Judgment. The teachings of Christ that those who do bear fruits will be cut off and thrown into fire does not represent hell.
A new movement in Megachurches is Hyper-Grace which may be called as re-reformed theology since they have more refined version of Luther's faith-alone and make less attempts to rationalize pro-works teachings. They teach not only works are optional but Preachers must avoid work-teachings. The work based teachings applied to pre-new covenant Jews; they are harmful for Christians and might cut us off from the grace.
Hyper Grace and many Baptist and Calvinist theologians present a solution that the commandments given in the Bible are sarcastic or satirical in nature. God never meant believers to actually do those things he commanded as he knew it to be an impossible task; rather he expected us to grasp the hidden sarcasm behind the whole law or commandments. That mysterious and hidden nature of sarcasm is revealed more clearly by Paul. If one takes those commandments to be literal and in plain sense, it only reflects one's blindness and legalism.
Paul Ellis of New Zealand. is one good example of the reformed theology or hyper-grace movement whose words pretty much sums up the approach of answering the work based teachings in the New Testament.
What are the commands of Jesus?
The next time someone tells you that you must keep the commands of
Jesus to prove your love, ask them, “what are the commands of Jesus?”
They will probably respond with the greatest commandment which is,
“love the Lord your God with all your heart, mind and soul” (Mt
22:38). This is fine, I guess. But if you insert that command into the
phrase above it becomes, “If you love me, you will love me with all
your heart, mind and soul,” which is kind of redundant.
If you read John 14:15 in context, you will see that on this occasion
Jesus is referring to two specific commands. Here’s the first:
“A new command I give you: Love one another….” (Jn 13:34)
And here’s the second:
“Do not let your hearts be troubled. Trust in God; trust also in me…
Believe me when I say that I am in the Father and the Father is in me;
or at least believe on the evidence of the miracles themselves” (Jn
14:1,11)
How can we be certain that these are His commandments? Because John –
who was there when Jesus spoke these words – says so in one of his
letters:
“And this is His command: to believe in the name of his Son, Jesus
Christ, and to love one another as He commanded us.” (1 Jn 3:23)
What does it mean to keep His commands?
Lest we dilute His commandments to accommodate our experience, Jesus
outlines His expectations of obedience for both. Here’s what He
expects from the first:
“As I have loved you, so you must love one another.” (Jn 13:34)
How did Jesus love us? By laying down His life for us (Jn 15:3).
That’s a high standard of love! Indeed, there is no greater love. And
what are His expectations regarding the second commandment:
“I tell you the truth, anyone who has faith in me will do what I have
been doing. He will do even greater things than these…” (Jn 14:12)
Believe in Jesus and you will do the works of Jesus. Put it altogether
and Jesus is saying this:
“If you love me, you will love one another as I have loved you and
your faith in me will lead to miracles like I have been doing and
greater miracles still.”
If you’ve been in any church for at least five years, you will know
that Jesus’ first commandment is pretty much humanly impossible to
keep, while the second commandment is definitely impossible. So the
next time someone tries to lay a heavy burden on you by telling you
that you must keep Jesus’ commandments to earn God’s love, just ask
them how many people they’ve raised from the dead! When they look
puzzled, tell them that Jesus commanded us to believe in Him and He
said that those who did would do the same works He did and greater
works besides!