Most Catholics and Protestants distinguish between justification and sanctification. In Catholic theology, the increase of justification is commonly called sanctification, and thus there are degrees of sanctification. I guess what you're really asking about is sanctification. In Reformation theology, sanctification and justification are described as two separate works of grace. Justification is the foundation, an external imputation of righteousness to the sinner who has faith in Christ.
Sanctification is the inward purification of that person.
The Reformers were adamant about the two not being confused. There may be something of a difference, then, between evangelicals and Catholics. We maintain that justification is not simply extrinsic. It originates outside but is received in us, so we are not only reputed just but are made really just or righteous. There is an inner transformation in justification itself.