Armbian - using CREATE_PATCHES

The Armbian build script has a built-in method to automatically create patch files from changes you do within the sources.
The official documentation writes about this:
prompt right before the compilation starts to make changes to the source code, separate for U-Boot and kernel, and will create patch files out of this. If you want these patches are included in the normal run, you need to copy them to their appropriate directories.
While this basically puts stuff in a nutshell for beginners this could be a bit confusing. In this post I will show you step by step how this works in a practical example.
- What is needed to start this process?
- Where are the sources to edit?
- Where are the created patches?
- How to apply them next time you build?