public String first3Letters(String str)

Given a String, return ONLY its First 3 letters.

Review:
You've had lots of practice using substring() to extract the first or last letters of a string.

String str = "ABCDEF";

str.substring(0,1) creates a substring with just the 1st letter: "A"
str.substring(1,2) creates a substring with just the 2nd letter: "B"
str.substring(0,2) creates a substring with the first 2 letters: "AB"
str.substring(1,4) creates a substring with the second 3 letters: "BCD"

str.substring(1) creates a substring without the first letter: "BCDEF"
str.substring(2) creates a substring without the first 2 letters: "CDEF"
str.substring(3) creates a substring without the first 3 letters: "DEF"

Notice that the number of characters you extract is the difference between the 2 parameters of substring(), e.g.
str.substring(2,5) extracts 5-2=3 characters.

If you want to extract the final characters, you need to know the length, e.g.

String str = "TUVWXYZ";
int len = str.length();

str.substring(len-1) creates a substring with just the last letter: "Z"
str.substring(len-2) creates a substring with just the last 2 letters: "YZ"
str.substring(len-4) creates a substring with just the last 4 letters: "WXYZ"

str.substring(len-2,len-1) creates a substring with just the 2nd-to-last letter: "Y"
str.substring(len-3,len-2) creates a substring with just the 3rd-to-last letter: "X"
str.substring(len-5,len-2) creates the substring: "VWX"

str.substring(0,len-2) creates a substring without the last 2 letters: "TUVWX"
str.substring(0,len-3) creates a substring without the last 3 letters: "TUVW"

The parameters for substring have to comply with the 2 rules below:
(1) They must be in the range 0 through len. That is, they cannot be negative and they cannot be greater than len.
(2) If you are using 2 parameters, the 2nd must be greater than or equal to the 1st - it cannot be smaller.
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Now to solve the problem. Normally you would solve it as follows:

public String first3Letters(String str) {
  String s = str.substring(0,3);
  return s;
}

But suppose the input parameter has FEWER than 3 letters.
For example: "AB" or "A".
When you run the program with these inputs, it will "blow up" when it tries to execute the line:
String s = str.substring(0,3);
because the 2nd parameter 3 violates the rule that both parameters have to be in the range(0,len).

The way to solve this problem is use an if statement that will
check whether the string is long enough to use in the substring statement.

public String first3Letters(String str) {
  int len = str.length();
  if (len >= 3) {
    String s = str.substring(0,3);
  }
  return s; // ERROR: Can't find s !
}

Notice the ERROR: s has now become a local variable in the body of the if statement.
You have to declare it outside the curly brackets so that the return statement can see it:

public String first3Letters(String str) {
  String s = "";
  int len = str.length();
  if (len >= 3) {
    s = str.substring(0,3);
  }
  return s;
}

Now if the string is shorter than 3 letters, the method will return the empty string.
However, the specs for the method don't tell us what to do in this case.
Here is a new spec:

public String first3Letters(String str) Given a String, return ONLY its First 3 letters.
If the string has fewer than 3 letters, just return the string itself.

This is easy to implement. Simply initialize s with str rather than the empty string ("").

public String first3Letters(String str) {
  String s = str;
  int len = str.length();
  if (len >= 3) {
    s = str.substring(0,3);
  }
  return s;
}