Auction Purchase with Owner Inhabitants

[Alexa Potocki]

Hi,

We just bought a foreclosure home at auction that we intend to rent. The house is currently occupied by the owner. 
How should we approach them? Should we offer to let them stay and sign a lease contract? Is it better to approach people in person or in writing? How should we identify ourselves - investors, landlords? We intend to come across as friendly, but this is a tricky situation and we don't know what we should present at the forefront.

Does anyone have experience with something like this? 

Appreciate any advice!

Alexa