In this present age of grace everything is "by grace"—which means all things are done by God for man. Man is saved without works. For "to him that worketh, the reward is not reckoned as of grace, but as of debt" (Rom. 4.4).

Because God deals with man in grace, there comes "fact." This means everything has already been accomplished by God for the world. Since the thing is done, it is called "fact." Due to it being fact, man has no need to work again for its accomplishment, since the work of God is complete and perfect.

However, the grace of God is righteous grace. Hence, with the presence of fact there is still the need of man’s cooperation. What is the nature of this cooperation? It is not that he must add more to the "finished work" but that he is to acknowledge that what God has done is true. This is "faith." Faith is to confess that all which God has said and done is true. Faith is accepting the fact and taking it as factual.

Moreover, faith is "drawing." I use this word "drawing" in the same sense as drawing from a bank: Someone gives you a check. He has money in the bank. This is a fact. If now you will go and draw out that money, it shows you admit that there is in fact in the bank the amount of money written on the check. In essence, this drawing is done by faith. With faith, you go to draw out. And once it is drawn out, there is money to spend. So that we can say that the money in the bank is "fact"; the drawing out is "faith"; and the spending of the money is "experience" or "favor."

In God’s grace there is already the fact of what He has done for man. Yet in man there is still the need of experiencing this fact or entering into this favor. In order to use God’s grace experientially you must exercise faith to draw upon the fact accomplished by God. Fact is what God has done. Faith is what man must have. Fact belongs to God whereas experience or favor belongs to man. Faith translates God’s fact into man’s experience.
And hence, what the Bible shows us is simply "fact—faith—experience."