Hi,
Suppose the loopback network on R5 is networked int the OSPF area 2, then the correspnding network will spread to R4, and due to the virtual link between R4 and R2, R4 will send the type 3 LSA which contains the R5 loopback interface network to R2 through virtual link, which will cause the type 3 LSA spreads in the area 0. On the other hand, as the ABR, R2 will spread this LSA into area 1. As drawing on the picture below shows:

Suppose that the type 3 LSA learned from the area 0 cost a lower cost than it from the areo 1, then on R3, the next hop of route towards to the R5 loopback interface is R1. When R3 trys to communicate with this network, the traffic will be forwarded to R1, then R2, then back to R3, and loop in R1 > R2 > R3 > R1.