Page 114-115 in Luther’s Large Catechism:
But as our would-be wise, new spirits assert that faith alone saves, and that works and external things avail nothing, we answer: It is true, indeed, that nothing in us is of any avail but faith, as we shall hear still further. But
these blind guides are unwilling to see this, namely, that faith must have something which it believes, that is, of which it takes hold, and upon which it stands and rests. Thus faith clings to the water, and believes that it is Baptism, in which there is pure salvation and life; not through the water (as we have sufficiently stated), but through the fact that it is embodied in the Word and institution of God, and the name of God inheres in it. Now, if I believe this, what else is it than believing in God as in Him who has given and planted His Word into this ordinance, and proposes to us this external thing wherein we may apprehend such a treasure?
Now, they are so mad as to separate faith and that to which faith clings and is bound though it be something external. Yea, it shall and must be something external, that it may be apprehended by the senses, and understood and thereby be brought into the heart, as indeed the entire Gospel is an external, verbal preaching. In short, what God does and works in us He proposes to work through such external ordinances. Wherever, therefore, He speaks, yea, in whichever direction or by whatever means He speaks, thither faith must look, and to that it must hold. Now here we have the words: He that believeth and is baptized shall be saved. To what else do they refer than to Baptism, that is, to the water comprehended in God’s ordinance? Hence it follows that whoever rejects Baptism rejects
the Word of God, faith, and Christ, who directs us thither and binds us to Baptism.
In the third place since we have learned the great benefit and power of Baptism, let us see further who is the person that receives what Baptism gives and profits. This is again most beautifully and clearly expressed in the words: He that believeth and is baptized shall be saved. That is, faith alone makes the person worthy to receive profitably the saving, divine water. For, since these blessings are here presented and promised in the words in and with the water, they cannot be received in any other way than by believing them with the heart. Without faith it profits nothing, notwithstanding it is in itself a divine superabundant treasure. Therefore this single word (He that believeth) effects this much that it excludes and repels all works which we can do, in the opinion that we obtain and merit salvation by them. For it is determined that whatever is not faith avails nothing nor receives anything.
But if they say, as they are accustomed: Still Baptism is itself a work, and you say works are of no avail for salvation; what then, becomes of faith?
Answer: Yes, our works, indeed, avail nothing for salvation; Baptism, however, is not our work, but God’s (for, as was stated, you must put Christ-baptism far away from a bath-keeper’s baptism). God’s works,
however, are saving and necessary for salvation, and do not exclude, but demand, faith; for without faith they could not be apprehended. For by suffering the water to be poured upon you, you have not yet received
Baptism in such a manner that it benefits you anything; but it becomes beneficial to you if you have yourself baptized with the thought that this is according to God’s command and ordinance, and besides in God’s name, in order that you may receive in the water the promised salvation. Now, this the fist cannot do, nor the body; but the heart must believe it.