Now, that bit - "inward reality" technically does not play up in Scripture neither does Scripture speak of such construct. If there is one, I like to be shown which Scripture that might be.
I go back to Acts 2:38
38 Then Peter said to them, “Repent, and let every one of you be baptized in the name of Jesus Christ for the remission of sins; and you shall receive the gift of the Holy Spirit.39 For the promise is to you and to your children, and to all who are afar off, as many as the Lord our God will call.”
This passage is commonly interpreted by Baptistic folk to mean, 1.) repent first, b.) then be baptized.
So only those that are to be baptized are those who have repented. Baptistic commentators also make bones about that repentance comes first before baptism.
The question is, how do you know you have repented? Hence, this makes the baptizer and the baptizee (sic?) look at the "inward reality" so that they may adhere to the command to be baptized. Honestly neither the credo-baptizer nor the baptizee know of such "inward reality" yet they have it in their language.
And this brings up another point, Acts 2:38 is looked at by the Baptistic person as a command.
This the reason why they have a hard time undestanding why a Lutheran can affirm JBFA and have real Sacraments of Baptism and Communion, they view the passage as a command to be performed, a Law.
If I have a Baptistic reader here, I like to throw another posibility of reading the text. That Act 2:38 passage is not a command but a promise! A gift. In fact that is what the passage says - "the promise is to you and to your children". Also the connection between the forgiveness of sins and baptism should not be ignored as some of you do. If you do not believe that forgiveness of sins is a gift, then you have to believe it is earned. Yet the passage speaks of baptism as a promise with attachments - forgiveness of sins and the gift of the HS.
That baptism is the repentance. That is why in Church History, it is not possible for someone to be considered a Christian if he is not baptized. Also in your circles, you have people questioning, "if baptism does not save, why do I have to be baptized, since I have given my heart to Jesus and I have already asked him to come in"? You have this paradigm and a conundrum of convincing the professor of the need to be baptized to fulfill a command.
In Lutheran circles, that paradigm does not compute because baptism is the gift itself, and the receiving of the gift...itself, in the name of Jesus, the forgiveness of sins.