You are still missing the point however since you bring up the 'free gift' I will expound on what that free gift is...
The 'free gift' is the gift of the Holy Spirit.
Eph 2:8 For by grace are ye saved through faith; and that not of yourselves: it is the gift of God:
Jas 1:17 Every good gift and every perfect gift is from above, and cometh down from the Father of lights, with whom is no variableness, neither shadow of turning.
Luk 11:13 If ye then, being evil, know how to give good gifts unto your children: how much more shall your heavenly Father give the Holy Spirit to them that ask him?
Act 2:38 Then Peter said unto them, Repent, and be baptized every one of you in the name of Jesus Christ for the remission of sins, and ye shall receive the gift of the Holy Ghost.
No it is not something we deserve, but what grace is and why we receive it are two different subjects... Grace is not unmerited favor. Grace is the free gift of the Holy Spirit.
let's compare some other scriptures to see how grace and the Holy Spirit 'parallel' each other...
Saved by:
Titus 3:5 Not by works of righteousness which we have done, but according to his mercy he saved us, by the washing of regeneration, and renewing of the Holy Ghost;
Eph 2:8 For by grace are ye saved through faith; and that not of yourselves: it is the gift of God:
‘Believe through’
Act 15:11 But we believe that through the grace of the Lord Jesus Christ we shall be saved, even as they.
Rom 15:13 Now the God of hope fill you with all joy and peace in believing, that ye may abound in hope,
through the power of the Holy Ghost
Our ‘teacher’:
Tit 2:11 For the grace of God that bringeth salvation hath appeared to all men,
Tit 2:12 Teaching us that, denying ungodliness and worldly lusts, we should live soberly, righteously, and godly,
in this present world;
1Co 2:13 Which things also we speak, not in the words which man's wisdom teacheth, but which
the Holy Ghost teacheth; comparing spiritual things with spiritual.
What we are ‘justified by’:
Tit 3:7 That being justified by his grace, we should be made heirs according to the hope of eternal life.
1Co 6:11 And such were some of you: but ye are washed, but ye are sanctified, but ye are justified in the name of the Lord Jesus, and by the Spirit of our God.
The covenant we are ‘under’:
Rom 6:14 For sin shall not have dominion over you: for ye are not under the law, but under grace.
Gal 5:18 But if ye be led of the Spirit, ye are not under the law.
The 'adoption':
Rom 8:15 For ye have not received the spirit of bondage again to fear; but ye have received the Spirit of adoption, whereby we cry, Abba, Father.
Eph 1:5 Having predestinated us unto the adoption of children by Jesus Christ to himself, according to the good pleasure of his will,
Eph 1:6 To the praise of the glory of his grace, wherein he hath made us accepted in the beloved.
‘full of’:
Joh 1:14 And the Word was made flesh, and dwelt among us, (and we beheld his glory, the glory as of the only begotten of the Father,) full of grace and truth.
Luk 4:1 And Jesus being full of the Holy Ghost returned from Jordan, and was led by the Spirit into the wilderness
’In your hearts’:
Col 3:16 Let the word of Christ dwell in you richly in all wisdom; teaching and admonishing one another in psalms and hymns and spiritual songs, singing with grace in your hearts to the Lord.
Gal 4:6 And because ye are sons, God hath sent forth the Spirit of his Son into your hearts, crying, Abba, Father.
Our helper:
Heb 4:16 Let us therefore come boldly unto the throne of grace, that we may obtain mercy, and find grace to help in time of need.
Rom 8:26 Likewise the Spirit also helpeth our infirmities: for we know not what we should pray for as we ought: but the Spirit itself maketh intercession for us with groanings which cannot be uttered
As you can see grace and the Holy Spirit are synonymous with each other...There are lots more ways to show that grace is a result of having the Holy Spirit and it is by that divine grace that we have our salvation. Nowhere in scripture does it say that we receive 'unmerited favor as a gift. We receive the power of the Holy Spirit as the gift.
The gospel clearly says that grace is the power of God given to us and in fact put into our hearts, causing us to live according to His will and enabling us to serve Him. Grace is a spiritual resource or 'commodity' that we receive through faith. Grace teaches us, helps us, comforts us, and empowers us. That is why we cannot boast that we are doing anything of ourselves because it is the power of God within us that is doing the 'labor'.
TC