On the way to interview the Hold Steady in New York, I run into the band’s singer and lyricist Craig Finn in a Brooklyn subway station. Unlike the characters in his songs, Finn is not reeling drunk, high on crack or coming down from some wild weekend of chemical and religious ecstasy. In thick-rimmed spectacles, clutching a battered novel, he is clearly a rock star more in the Elvis Costello than the Elvis Presley mode. Bookish, anti-fashion, scarily normal — geek chic personified.

Even so, the Hold Steady are becoming bizarrely fashionable across the Atlantic. Having recently made the cover of Village Voice, their glum thirtysomething faces frown down from billboards all across New York. Their third album, Boys and Girls in America, released late last year in the US and due here this month, made the Top Ten year-end polls of a dozen music magazines, including Rolling Stone and Billboard. They are America’s hippest unhip band.

The Hold Steady’s revved-up anthems of sin and salvation are similarly against the grain, reactivating a kind of pre-MTV school of classic-rock, saloon-bar Americana.

It is a tough formula to get right without sounding trite or knowingly retro, but the wordy teenage passion plays on Boys and Girls in America are droll, dynamic and exhilarating. They are peopled with romantic dreamers hungry for escape, and the most commonly cited reference point is Bruce Springsteen’s E Street Band in their prime.

“The E Street Band is kind of a classic, piano-driven rock band,” nods Finn when we settle in a suitably no-frills downtown diner. “They just happen to be the best. It’s simple, straight-ahead rock.”

Brought up in Minnesota and Wisconsin respectively, Finn and the band’s guitarist, Tad Kubler, moved to New York City at the start of the decade after dissolving their previous band, the Minneapolis-based Lifter Puller.

But the Midwest still shapes their musical taste and ultimately, Finn argues, the sound of the Hold Steady. “Growing up in the Midwest, there was no alternative rock’n’roll radio,” he says. “The second you got in your car the only music you could listen to was classic rock.”

Indeed, the Hold Steady began to take shape when Finn and Kubler reunited in 2002 to play jokey instrumental covers of Thin Lizzy and AC/DC songs for friends who ran a Manhattan comedy troupe. “That was what got us writing songs as a band,” Kubler recalls. “We just realised that this stuff is always going to sound good.”

After making their live debut in January 2003, the Hold Steady graduated from playing comedy covers to writing original material. But, says Finn, humour is still an essential ingredient. “All good rock’n’roll is funny in some way,” he argues. “Lyrically there are times where I’m just trying to write things to make my friends laugh. I wouldn’t say it’s comedy, it’s deeper than that. But from Chuck Berry to Mick Jagger to Bob Dylan, it’s all funny.”

Proud of their Midwestern distrust of hip metropolitan scenes, they turned their regular-guy traditionalism into an anti-fashion asset just as New York was tiring of retro-disco post-punk revivalists. “Everywhere you’d go you would hear a certain type of music,” Finn recalls, “so when we got together and played this sloppy rock’n’roll it sounded especially good.”

In common with Springsteen and Dylan, Finn’s lyrics are steeped in literary Americana. Like a sprawling short-story collection all three Hold Steady albums feature the same loosely linked characters. Boys and Girls in America is even named after a line in Jack Kerouac’s classic beatnik novel On the Road.

“I read On the Road when I was 16 and I didn’t like it, didn’t get it,” Finn says. “At 16 you don’t really have any life experience. But I reread it at 32 and it kind of blew me away. Mostly I thought it was funny. I saw that line and decided I could get a whole record out of that quote.”

Outside music, Finn clearly harbours his own literary ambitions. “I have an outline for a novel that I expand from time to time,” he says, “but at this rate it’ll get done about 40 years from now. The past few years have been pretty busy. It’s based on a real crime that happened in Minneapolis. It’s a mystery but not a detective story.”

Like countless writers, the Irish-American singer was brought up a Catholic. But unlike many of them, Finn still finds his religious upbringing a source of inspiration. “Yeah, grace and beauty, you know?” he nods. “Even though I don’t go to church, and I don’t feel like I need the Pope in my life, it is part of who I am. It may not have anything to do with what I believe, but it just puts all the rest of that switching and searching to rest.”

Finn claims that Catholicism taught him that “there is hope in any situation”. But he hasn’t been to confession for 20 years, and besides “I never told them everything, anyway. I’ve got a lot of catching up to do! Heh heh!” Indeed he has, if his sin-soaked lyrics are even half true. Hold Steady songs are saturated with sex and drugs, raging highs and crashing lows. But Finn cautions against his words being read as undiluted autobiography.

“In America, and I’m guessing everywhere else, teenagers do drugs and drink alcohol,” he shrugs. “So they are autobiographical in that I was a teenager, but I don’t think I did more drugs and alcohol than most of my peers.”

But some of the drug references are very specific, such as smoking crack through a Pringles tube. Has Finn ever tried that? “Naah, I’ve never smoked crack, period, through any device.” Kubler concurs. “No crack or needles if you want to have a good time,” he says. “If you’re getting into s*** like that, you’re not having fun any more. You are somewhere else.”

So far the Hold Steady have only ever played one UK show, in London in 2005, but they return for their first real mini-tour next month. “This trip has really been a big goal for us,” Kubler says. “One thing I’m really excited about is getting over there and picking up all the new curse words.”

Hold Steady shows are reportedly rowdy, boozy, high-energy affairs. “We drink a lot of beer onstage,” Finn smiles. “It’s part of trying to set the tone of the audience having a good time. But in the songs, I try to show the hangover for every high I talk about.”

Boys and Girls in America is released on January 22 on Vagrant. The UK tour starts on Feb 13 in Manchester, www.holdsteady.com