Is not that extra project folder annoying? Yes, they changed egit again as you can no longer store the repo in the eclipse workspace. To get the .git metadata folder in the project folder root like github expects uncheck default location at project setup and add an extra folder above the project name. For example:

home/fredgrott/git/github/projectname

This will than allow you to store the .git metadata folder in the proper place as its not crating the repo in the workspace which is not allowed.

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