[Dovecot] adding new user to dovecot

[Kartik Vaidyanathan]

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Hi,
This is from your documentation
Creating new users
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Dovecot is interested in only one thing - being able to find the user's
mail directory. With maildir you need to do mkdir ~user/Maildir, with mbox mkdir ~user/mail.

what does ~ refer to.
Pardon my ignorance in unix, i am relatively new to unix.

Does not ~ refer to the user account in which you have logged in.
So does that mean that maildir folder exist for only user accounts that already exist.My intention for asking the above is that i have a java program running, that will take a new users name and password, so with that can i create a mailbox for that person , or does the admin have to create an user account for that person , so that his maildir folder can be created.

Please clarify my understanding of how it workds..
Thanks