2 Corinthians 5:17
17 Therefore if any man be in Christ, he is a new creature: old things are passed away; behold, all things are become new.
The above verse is often used to teach that a "true" believer will live a generally upstanding life, leaving behind their old sins, and walking in their new nature.
From that basis, it's then concluded that if someone lives an immoral life, they are not born again. Is that a valid way to use this verse?
While this verse is often used to argue that there must be some change in behavior after faith, that isn't what the verse says at all. It doesn't say "some things are become new". It says "all things are become new".
Therefore, this could be used to argue for sinless perfection, but certainly not the nebulous haze of requiring "some change" in a person's behavior. That's simply ignoring what the verse actually says.
The New Man, which is born again inside of every believer at the moment of faith (John 1:12, Galatians 3:26: 1 John 5:1), is sinlessly perfect.
Not only is it born of "incorruptible" seed:
1 Peter 1:23
23 Being born again, not of corruptible seed, but of incorruptible, by the word of God, which liveth and abideth for ever.
But it also "cannot sin", because of the incorruptible seed that remains in him:
1 John 3:9
9 Whosoever is born of God doth not commit sin; for his seed remaineth in him: and he cannot sin, because he is born of God.
Therefore, as our verse in question says, "all things" have been made new. There is inside every believer a sinless New Man, which is as perfect as Jesus Christ.
However, we still have our flesh from the first birth, as the "redemption of our bodies" (Romans 8:23), whereupon we will receive a physical body that is perfect, to match our New Man, is a future event.
In the meantime, it takes effort on the part of a believer to walk in the Spirit, and not the flesh, hence the countless exhortations like:
Romans 13:14
14 But put ye on the Lord Jesus Christ, and make not provision for the flesh, to fulfil the lusts thereof.
Galatians 5:16
16 This I say then, Walk in the Spirit, and ye shall not fulfil the lust of the flesh.
The fact that these commands are given, is proof that it takes work to do this, as if it were an automatic reality that we all walked in the New Man simply because we have it, these exhortations would be totally unnecessary, and issuing them would be deceptive and confusing.
Therefore, nothing in the verse in question argues against the Free Grace position that a believer can live wickedly after they believe. The strange doctrine that a believer cannot live wickedly denies reality, as all those who teach it sin every single hour of their lives (1 John 1:8, 5:17, etc.). It also teaches a strange idea that there is some unknown, woefully imperfect "baseline" of goodness that all "true" believers will obtain, as if God has issued a guarantee that we will still be wicked, but not "too wicked" - with "too wicked" usually being defined as "below whatever the particular false teacher lives up to in their personal lives".
This article basically turned into a condensed version of the article Every Believer Has Two Natures, so please refer to that for further reading on this topic, if you'd like.
Both the Bible, and common sense, prevent the bizarre application of this verse that teaches a backdoor works Salvation. Rather, it teaches sinless perfection of the New Man, as a point of doctrine. Whether a believer walks in that new nature is a constant choice, and daily struggle. As such, it has nothing to do with whether or not they get to Heaven, but rather determines blessings in this life, avoiding chastening (Hebrews 12:6), and earning eternal rewards, topics which are all covered in many other places on this site.